I took out two student loans from a state government program, one in 1994 and one in 1995, each for $2000. In 2002 I called them up and said I wanted to pay them ALL off what is the total. They told me $5500, but they would accept $4200. I paid them, and last year got a letter that I owe $4200 on a loan taken out in 2003. I asked what is this about I paid you off here is my check. They said you only paid one becuase the other one was defaulted and transferred but now they have it back. The reason it seemed like the right $amount for both was because of years of not paying and penalties. So am I out of luck? I can't just dispute with credit bureaus cause they report every month that I dont pay.

When you paid in 2002, had you been paying on either? Did they at least mark the one as paid? Did you pay when they contacted you last year?

I think it is possible that they are correct in what they're telling you. When my loans went into default, that added about 25% to the total balances, just in penalties and fees, not even including the interest. It's also possible (if not likely) that the CA never reported on your CR -- mine never did and I've heard the same from others here. I would still ask for information from them on the loans to make sure that they actually are yours. It's probably quite likely that they screwed up when they neglected to tell you that they only had the one there, but, unfortunately, there's only a couple of options of ways to get them to compensate you for these sorts of things, but it's really unlikely that anything will work (don't you love government!).

What are you looking to do? Remove them from your CRs? If you haven't paid and they are yours, it's EXTREMELY unlikely that it's going to happen. SLs don't really go away and they're VERY good at verifying/validating (sorry, I never remember which one is which) information. I'm not sure if it's available for state-backed loans, but you may want to ask about rehabilitating the loans. If it's available, rehab allows you to make 12 payments and then the default status is removed from the CRs and your loan returns to regular repayment status. Otherwise, if you're just looking to have them removed, I don't really have any help for you, but others might.

Good luck!!

Thanks,

> When you paid in 2002, had you been paying on either?
No.
> Did they at least mark the one as paid?
Yes.
> Did you pay when they contacted you last year?
No.

I was hoping to convince them I was done, but I guess that's not going to happen. I guess my next bet is to pay them off on the condition that they delete. Is that unlikely with federally back student loans?

Well, good news and bad news. Pay for delete, I don't see happening at all. Since this is a federally-backed loan, there's no statute of limitations on collecting these and they've got a TON of arsenal at their disposal, so there's absolutely no incentive for them to do this. They can sue you forever, take your tax returns, and garnish your wages without having to go to court first. I doubt that it hurts to ask, but don't hold your breath. Yeah, that part stinks.

However, there is good news. Since this is a federally-backed loan, rehabilitation is an option. Under rehab (which they have to allow you to do), you make 12 voluntary, reasonable monthly payments. After those payments, your loan is no longer in default and the default notation is removed from your CR (except in VERY limited circumstances). They're "encouraged" to also remove all of the negatives (lates, etc.) from the TL, but that's not a requirement (I'm not sure, but I would say that the majority do, but as to whether that's a 51% or a 99% majority, I don't know). Then, you just pay on it like any other SL. If you do a search in this forum, you can find a ton of information on rehab. Just remember that you have to ask for it and to get everything in writing.

Hope this helps!! Good luck!!

If this is a state issued student loan, it is most likely federally backed. Since it is so old, I would ask your state lending authority to send you copies of your original promissory note(s). In those years, you would have been required to sign an individual promissory note for each loan you took out. This would be your only option for validation/verification that the debt is actually yours.

If your state can send you copies of your promissory notes, I would look to see if there are any provisions for rehab. Rehab is generally only available to you on true federal loans such as Perkins, Stafford and Direct loans.

You may be able to dispute them off your credit report once they are paid in full.

Thanks a lot guys.

Well they say they can't rehab it yet since its not in default. Apparantly it will be pretty soon though ;>. Am I better to pay it off or wait until eligble for rehab? Or do I just ask again with a different person?
The crazy thing is there are 5 student loans on my credit report, all for those 2 (one paid). When they take them in and out of deafult and change departments and stuff (all of this without me paying or doing anything) they add another entry. Last year I disputed the extra ones and some were deleted. However, experian has "verified as of 12/2003" on all of them. I asked for dept of ed, my state, etc to verify and they sent me the original paperwork for the original 2 loans and a letter saying the one is paid in full (but says settled for less on credit report). Anyway, I guess i'll follow all the great advice on these boards and the newbie section,etc and get cracking on this. sounds like fun, huh?