Which is best way to take care of defaulted private SLs?

[Juniper117]

I have 3 PRIVATE SLs w/ AES (They are listed as AES/NCT, if it matters). They defaulted a year ago and I've been making weekly payments for almost 8 months. I was under the impression that I could not rehab them, but I just saw on their website that they have a rehab program for private SLs. I'm not certain that I qualify, as they didn't mention it earlier, but if I am, I'd like to know which option would be better.

 

My goal is to buy a home w/ FHA financing ASAP. The TLs are showing as 3 private loans w/ AES ('claim filed with government') and 3 collection accounts, so 6 entries total for the 3 loans.

 

 

-PIF. My partner and I are both students (one of us undergrad, the other grad). We're enrolled half-time, so we get the full Stafford loan disbursement, and have an excess amount of about 7k each semester. I could put that money toward the student loans and have them paid in full next August. I don't know what that would do to the TLs- would it make the collection accounts disappear? Or would they just show PIF?

 

-Rehab. (If it's available, obviously, though it appears that it is.) I would be making higher payments each month, but they're still do-able. I would put the SL money towards paying down utilization and CAs I have on my account. I could also save the money in my ING account and then once the rehab is done, I could PIF, I suppose.

 

The timeline works out to the same, essentially, but I want to do what will look the best in 18 months or so when I hope to get a mortgage.

 

Thoughts? What happens to the TLs in each scenario?

Edited August 14, 2010 by Juniper117

[LynnInMN]

I have 3 PRIVATE SLs w/ AES (They are listed as AES/NCT, if it matters). They defaulted a year ago and I've been making weekly payments for almost 8 months. I was under the impression that I could not rehab them, but I just saw on their website that they have a rehab program for private SLs. I'm not certain that I qualify, as they didn't mention it earlier, but if I am, I'd like to know which option would be better.

 

My goal is to buy a home w/ FHA financing ASAP. The TLs are showing as 3 private loans w/ AES ('claim filed with government') and 3 collection accounts, so 6 entries total for the 3 loans.

 

 

These dont sound like private loans....they sound like FFELP loans which are federal. Are they staffords??

 

-PIF. My partner and I are both students (one of us undergrad, the other grad). We're enrolled half-time, so we get the full Stafford loan disbursement, and have an excess amount of about 7k each semester. I could put that money toward the student loans and have them paid in full next August. I don't know what that would do to the TLs- would it make the collection accounts disappear? Or would they just show PIF?

 

-Rehab. (If it's available, obviously, though it appears that it is.) I would be making higher payments each month, but they're still do-able. I would put the SL money towards paying down utilization and CAs I have on my account. I could also save the money in my ING account and then once the rehab is done, I could PIF, I suppose.

 

The timeline works out to the same, essentially, but I want to do what will look the best in 18 months or so when I hope to get a mortgage.

 

Thoughts? What happens to the TLs in each scenario?

 

 

If you have been making payments for 8 months and these are staffords, you could potential qualify for rehab in a month. Talk to the CA handling it.

 

Your guarantors tradeline will be removed...the original creditors negative tradeline will remain.

[Juniper117]

They are private, unfortunately. I saw the rehab program offered on AES's website, which had no mention of it being for just federal loans, but I'm now assuming that they do in fact exclude private loans.

 

I'm calling tomorrow to be sure.

[LynnInMN]

They are private, unfortunately. I saw the rehab program offered on AES's website, which had no mention of it being for just federal loans, but I'm now assuming that they do in fact exclude private loans.

 

I'm calling tomorrow to be sure.

 

 

You said your credit report says government claim.....true private loans never say this.

 

There is NO rehab for private loans. Only federal loans qualify for this program under the HEA.

[Txgirl]

You said your credit report says government claim.....true private loans never say this.

 

I have private student loans that say this on my credit report. I have called to verify with the NLSDS (is that the right acronym?) and these are not listed, only my federal student loans.