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TPD Discharge ruined my credit.

FreedomHammer
Valued Member

TPD Discharge ruined my credit.

 I had many individual student loans from 1999 until 2010 reporting on EX report and it said they won't fall off "on record until" December 2025. All of the loans had perfect payment history. 

 

I refinanced in 2015, which closed out all the individuals loans. 

 

I applied and was subsequently approved for TPD discharge at the end of September last year.

 

Six months later, Nelnet took the wrecking ball to my Experian report -- all the individual loans have been deleted, essentially halving my AAOA. My EQ and TU have not been hit yet by the wrecking ball. 

Experian says Nelnet requested the deletion at the end of March. Nelnet corporate says regulation says they are to be deleted after your date of disability. 

Nelnet's own website states that account history for TPD discharges should remain for historical purposes with a status code of 5, "transferred to another lender", which is the Dept of Ed. 

Experian says to request Nelnet to reinsert; I doubt this will happen.  

I am grateful for the discharge; it did lower my DTI, but it ruined my length of credit history. 

Any idea how I should proceed? 


Why would they only purge from one bureau? And how is this considered Metro2 compliance? 

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2 REPLIES 2
blindambition
Community Leader
Senior Contributor

Re: TPD Discharge ruined my credit.

A closed account can report for up to 10 years, but a lender may remove anytime. Nothing making them report full 10 years.

Message 2 of 3
FreedomHammer
Valued Member

Re: TPD Discharge ruined my credit.

From https://www.nelnet.net/media/newsletters/CB_ReprtPermDisbDisc.asp 

 

 

"Non-defaulted loan held by the lender – The consumer data industry recommends that the lender report Status Code ‘05’ and the Payment Rating that is consistent with the current or delinquent status of the account on the date a lender submits a claim to the guarantor or receives payment from the guarantor (i.e., 0, 1, 2, 3, 4, 5 or 6). Status Code ’05’ is defined as ‘Account transferred to another office’ and the Payment Rating indicates that the payment for this month was current or delinquent.

 

Since the account is being transferred to the Department for further processing, this status is applicable. Additionally, any credit history already established by the borrower would be retained for historical credit reporting purposes. No further reporting by the lender would be required, as Status Code ‘05’ is a final status. Since the Department will be responsible for the loan after assignment, it is not necessary to require further reporting by the lender.

In summary, the lender should report Status Code ‘05’, Payment Rating 0, 1, 2, 3, 4, 5 or 6 and a Payment History Profile Grid that represents the accurate account history that should be retained for the account."



Message 3 of 3
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