Entering into rehad caused a 100 point drop on CR's

[momx6]

My student loans were being serviced by Nelnet, but went into default and were sent back to the Michigan Higher Education Authority (we now reside in Tennessee) in December, 2006. I spoke with a CSR at MHEA and they set me up on monthly payments and said that after 9 months of ontime payments, all negative notations in regard to my student loans will be removed.

 

I'm thinking "Great, 9 months isn't too long to wait for this to be cleared up on my reports". However, I checked my reports today and not only is Nelnet still reporting these 2 loans as repossessions and charged-off, but now the MHEA is reporting them as defaulted loans as well and I lost 100 points on all 3 reports.

 

Are these reporting correctly? If not, how should they report? What is the point of entering into rehab if it's going to do that much damage to your reports in the mean time?

Edited April 9, 2007 by momx6

[Cynic]

My student loans were being serviced by Nelnet, but went into default and were sent back to the Michigan Higher Education Authority (we now reside in Tennessee) in December, 2006. I spoke with a CSR at MHEA and they set me up on monthly payments and said that after 9 months of ontime payments, all negative notations in regard to my student loans will be removed.

 

I'm thinking "Great, 9 months isn't too long to wait for this to be cleared up on my reports". However, I checked my reports today and not only is Nelnet still reporting these 2 loans as repossessions and charged-off, but now the MHEA is reporting them as defaulted loans as well and I lost 100 points on all 3 reports.

 

Are these reporting correctly? If not, how should they report? What is the point of entering into rehab if it's going to do that much damage to your reports in the mean time?

 

Entering rehab didn't cause the reporting- defaulting did.

 

Nelnet is correct because you defaulted on your repayment agreement with them.

 

MGA/MHESLA is correct because they paid the default claim and you have not yet successfully completed rehab.

 

MGA/MHESLA will remove or update their reporting once you successfully complete rehab.