Jump to content

First day of delinquency being reported as first day of default


The last post in this topic was posted 2601 days ago. 

 

We strongly encourage you to start a new post instead of replying to this one.

Recommended Posts

I think I got the title wrong but I don't know how to edit it, it should read:

 

First day of default being reported as first day of delinquency

 

I have 3 loans with Department of Education, originally they were Direct Loans in 2007, now they are called Direct Stafford Subsidized. I have consolidated them last year, they show "paid collection" as of now. Also, these 3 loans share the same first day of delinquency since I never paid for them once they got out of forbearance initially (other than through tax offset).

 

Now, the problem with the first day of delinquency. I am waiting for these loans to fall off this year and I found an error that will prolong them further than they must stay on. When I go to the nslds.ed.gov to view my loans, even the past paid ones, I can see detailed info of each loan. The details say REPAYMENT started on 7/2007 and then DEFAULTED 5/2008. However, on all credit reports it says that first day of delinquency is 5/2008. Correct me if I am wrong, but first day of delinquency is not equal to first day of default, right? Especially that non-educational institutions have 120 days before it becomes a default, I think. But here it is 270 days difference that pushed my hopes and dreams of having a clean report by another 9 months. Unbearable! I have already waited for a while... :cry2:

 

I can see that the first day of default was calculated correctly (see image below):

Per Higher Education Act of 1965 Sec. 435(i) it says that the loan becomes in default after 270 days since non-payment, that is ~9 months. So, if the due date is on or about 07/2007 and the first day of delinquency would be 30 days late (I am reaching here), about on 08/2007, I'd say. Then add 9 months and you get about 05/2008. Sure, it is possible I fudge the numbers, let me know if I am, just my line of reasoning. If I am incorrect, please let me know.

 

This is a screen show for one of the 3 loans, others are the same date wise, just $$$ differs.

9k9mxe.png

 

Point is, something is up and it might be affecting you too, do check! Instead of these negatives falling off this year, because of incorrect reporting it is being pushed up another 9 months for no good reason.

 

I called Dept. of Edu. today, people I spoke to have said that they have no idea who is reporting it internally, evidently Direct Loans were distributed to many different sub-departments within the Dept. of Edu (once Direct Loans ceased to exist). However, the people I spoke to did see that the first day of delinquency is set at 5/2008 in the system, they don't care why or who set it. They are unwilling to change, say they cannot do that even if they wanted. All they could advise me was to stop tying their phone lines and start disputing this info with the credit agencies.

 

So, I did with all 3 credit agencies, sent them all a fax with a letter, included my math (hope it is solid), and printouts from the website that show dates I am falling back to as my proof.

 

Well, what are your thoughts on the subject?

Edited by ΤexasGuy
Link to post
Share on other sites

If loans are defaulted, credit reporting works differently than for other debts. The creditor has 3 options for when to begin reporting defaulted student loans.

 

- from the date the defaulted loans are paid

- from the date they are first reported as a default

- from the date they default again

 

It looks like they're using the second option. So negative info will remain on your record until 7 years from the date they defaulted. In short, for the purposes of negative reporting on your defaulted loans, your de facto date of first delinquency is indeed in May of 2008.

 

Just be glad that they're not using the first bullet point, which would make it so that they could report the negative info for 7 years from the date your defaulted loans were paid, which was January 2014, when your consolidation went through.

Link to post
Share on other sites

Sorry, it sounds unrealistic as you suggest there are no standards what so ever, as if they can just report any arbitrary number of their choosing. May I ask for a proof of your opinion?

It's not an opinion.

 

http://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title20-section1080a&num=0&edition=prelim

 

(f) Duration of authority

Notwithstanding paragraphs (4) and (5) of subsection (a) of section 605 of the Fair Credit Reporting Act (15 U.S.C. 1681c(a)(4), (a)(5)), a consumer reporting agency may make a report containing information received from the Secretary or a guaranty agency, eligible lender, or subsequent holder regarding the status of a borrower's defaulted account on a loan guaranteed under this part until-

(1) 7 years from the date on which the Secretary or the agency paid a claim to the holder on the guaranty;

(2) 7 years from the date the Secretary, guaranty agency, eligible lender, or subsequent holder first reported the account to the consumer reporting agency; or

(3) in the case of a borrower who reenters repayment after defaulting on a loan and subsequently goes into default on such loan, 7 years from the date the loan entered default such subsequent time.

Link to post
Share on other sites

TexasGuy - You are confused! You are NOT the holder of the loan - the definition of the word 'holder' is Lender/Servicer of the account (the one you didn't pay which resulted you being in default!)

 

How in the world did you interpret holder as the student? Did the Secretary or agency pay a claim to you? No, they paid the Lender/Servicer.

Link to post
Share on other sites

It always confuses me when people get so defensive when they get answers they don't like. Why even ask for help?

 

scvbd99's link is accurate and correct. Your derogatory information was first reported when the loan went into default, the date of which was May/08. They are legally entitled to report it in that manner. I had prior TLs on my CRs from the original / subsequent loan servicers from my default (which has since been addressed). The original account had the DoFD as the actual date that my monthly payment was first delinquent. The second account listed it as the month my loan went into default.

Edited by almostanonymous
Link to post
Share on other sites
  • 2 weeks later...

If loans are defaulted, credit reporting works differently than for other debts. The creditor has 3 options for when to begin reporting defaulted student loans.

 

- from the date the defaulted loans are paid

- from the date they are first reported as a default

- from the date they default again

 

It looks like they're using the second option. So negative info will remain on your record until 7 years from the date they defaulted. In short, for the purposes of negative reporting on your defaulted loans, your de facto date of first delinquency is indeed in May of 2008.

 

Just be glad that they're not using the first bullet point, which would make it so that they could report the negative info for 7 years from the date your defaulted loans were paid, which was January 2014, when your consolidation went through.

This is very helpful, i didn't know that and I'm still trying to make heads or tails out of my credit reports. damn you student loans.

Link to post
Share on other sites
  • 2 weeks later...

The last post in this topic was posted 2601 days ago. 

 

We strongly encourage you to start a new post instead of replying to this one.

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

  • Similar Content

    • By invisible
      Basically, below are the baddies on my reports. I know I can't do much for the lates, but I'm hoping I can work on the other ones. I’ve been lurking and researching, but not sure what to start with. Any help is appreciated.
       
      Equifax
       
      Lates:   Auto loan – 10x in past 2 yrs.
                  8 Navient Accounts – 7x in past 2yrs. (although was in forbearance)
                  2 Utah Higher Edu Accounts – 6x in past 2 yrs. (must verify if was in forbearance or deferment)
                  1 ACS Group Account – Sold in 2016, shows as closed and current status of 120 days past due.
       
      Charge Offs:    Cap One #1 = $1850 from Apr 2020, but shows as open and 120+ past due
                              UM Old Balance from 2012 – $8k
       
       Experian
       
      Lates:   Auto loan – 14x in past 2 yrs. Status says: Now paying/was a charge-off
                  8 Navient Accounts – 7x in past 2yrs. (although was in forbearance)
                  2 Utah Higher Edu Accounts – 6x in past 2 yrs. (must verify if was in forbearance or deferment)
                  1 ACS Group Account – Sold in 2016, shows as closed and current status of 120 days past due.
       
      Charge Offs:    Cap One #1 = $1850 from Apr 2020
                              Cap One #2 = $613 from Oct 2019
       
      Trans Union
       
      Lates:   Auto loan – 14x in past 2 yrs. (says C/O for Oct 2018)
                  8 Navient Accounts – 7x in past 2yrs. (although was in forbearance)
                  2 Utah Higher Edu Accounts – 6x in past 2 yrs. (must verify if was in forbearance or deferment)
                  1 ACS Group Account – Sold in 2016, shows as closed and current status of 120 days past due.
       
      Charge Offs:    Cap One #1 = $1850 from Apr 2020
                              Cap One #2 = $636 from Oct 2019
       
      Collections:     IC Systems (Charter Communications) = $167
       
       Auto loan: It was almost a repo. I paid past due the same day they set it out to be towed. I was 3 months behind. Why are they saying it was a charge off? What can I do?
      Student loans: I was in forbearance, but Navient says they no longer change credit reports. They sent me letter confirming forbearance for those months.
      Charge Offs: Since they are within past year, should I try to settle, pay in full, or wait a while?
    • By maddox80
      Lovely Navient is posting 4, yes 4 charge-offs on my credit report.  I'm starting with Equifax.
       
      Round 1:  Disputed because there was still a past due balance showing on the charged off accounts (all of them).  One Navient Account deleted, the rest were "verified."  Equifax "updated" the "date of last payment" to literally June 2020 ... on charged off accounts.   They still show a past due balance, even though the debts were sold to a collection agency. 
      Round 2:  Sent a method of verification letter to Equifax.  Equifax responded with a "We don't have a credit file for you" letter.  Stall tactic?
      Round 3:  Sent a second method of verification request with copies of the "we don't have a credit file for you" letter, proof of identity, copies of their previously "verified" accounts/"investigation results" pointing out they reported payments on charged off accounts.  Interestingly, the "little boxes" that appear under the accounts which tell you if it's a timely payment, late, or a charge off still show a "late/charge off" for the months Equifax says they verified I made payments.  Result:  Investigation is PENDING.
       
      I signed up for MyFico and apparently, Navient is reporting these charge offs/lates, FRESH, on a monthly basis - even after they sold the debt.  Is this legal?  How can I be late on a debt that doesn't exist anymore since they sold it off? I had a charge off before for a credit card a long time ago and once it was charged off and sold (Navient sold the debt as well) it wasn't reported every.dang.month.  Is this legal or some sort of reporting violation?
       
      Am I doing this correctly?  Should I do a 609 and demand that they show me a copy of my MPN?  TIA!!!
       
       
    • By Humbled82
      Hello Credit Board
       
      I am newbie to this forum, but have been lurking for a while. I had recently pulled my credit report and I am having major issues with my student loans. Apparently I have loans that have been transferred \ sold and now are with a new company. The original loan was open back in the 2000's but they are still showing on my credit report. I am not sure how I can have these removed. Any assistance would be greatly appreciated. 
       
      Thank you in advance
    • By Ambrcat14
      Hi, I'm new here and got a notice from a credit agency on my private student loan.  It's been 3 years since I last paid as I was contesting the amount and got sick.  I signed for the loan in D.C. and the loan originated in OH.  I now live in OH.  I also stopped paying while I lived in NY (before I moved to OH).  I just got a letter from a CA based in NY state (don't know if the CA state location makes any difference).  My question is which SOL will apply?  OH, NY or the shorter DC SOL of 3 years?  OH has a number of SOLs, 6 years, 8 years so I'm not sure which SOL would even apply to the promissory note for the bank based in OH.  How could I look this up at a law library.  I'm not very familiar with the process if anyone could help with legal research ideas?  I'm also contesting the validity of the loan because the promissory note states that the repayment period is 240 months and I think I have passed this point.  Any help I can find would help a long way; very stressed out by this situation---there are so many ways this could go---if the CA goes through with a judgment and wage garnishment (I'm disabled and earn a very small part time income) can they revive the judgment every five years for 15 years (OH) even after the SOL expires on the private loan itself (3 yrs DC SOL, 6 yrs NY SOL, 6 or 8 yrs SOL OH)?  I don't know if I should just ignore the CA or write them to dispute this loan (and risk waking the sleeping giant) or wake the sleeping giant with a dispute letter and prepare myself to go to court (have no idea how I would defend myself but would like to dispute amount of the loan, SOL etc).  This all seems very risky.  Can this debt sold to a credit agency be invalid?
    • By mistermanager
      Hi everyone! Just joined the community after hearing great things on an number of personal finance forums. I'm trying to rebuild my credit so that I can get a good mortgage hopefully by the end of 2020. Specifically, I'd like to increase my score from 568 to above 700 -- I know that's ambitious.
       
      Some positives. Several weeks ago, I paid off the remaining balance on my CC debt. I'm now in the middle of consolidating my student loan debt, which racks up to about $42K. I'll begin making monthly payments as soon as that process is complete. 
       
      The not so good. The student loan debt mentioned above. I also have four collection / chargeoff accounts at Cap 1 (x2), Discover, Wells Fargo and Discover. 
       
      I don't know where to start. I've recently tried applying online for a number of secured credit cards with Cap 1, Discover and Citi but have been denied due to my past issues. Are there any banks that will accept me? What are my other options? Any advice is welcome and I'm ready to do whatever it takes to reach or move closer towards my goal. For what it's worth, salary is between $100K and $120K and paying about $1.3K in rent every month.
       



  • Member Statistics

    • Total Members
      180,836
    • Most Online
      2,046

    Newest Member
    MyraC
    Joined
×
×
  • Create New...

Important Information

Guidelines