Defaulted Perkin's Loan not on credit reports?

[Dalton23]

Hello everyone, hoping someone can help me out here.

 

I have a Perkins loan (from 2004)...apparently it's been in default since 2012. I just recently found out about it, the strange thing is that it's not on any of my credit reports. The past few days i've been talking with my old school, ESCI (company that handles my school's loans), and the collection agency to try and figure it out (their giving me the run around). My school claims that ESCI has been reporting it to all 3 bureaus...the collectoin agency has said my account was closed? I'm not sure how to handle this. I'd like to consolidate the Perkins with my other loans, but knowing my luck after I do that the defaulted loan will magically appear on my credit reports. Should I play it safe and rehab the Perkins? Or consolidate?

 

P.S (strangely, I have the same exact situation with a BOA collection...CA tried to settle a debt with me, yet it's not on any of my reports?)

 

Thanks!

[Dalton23]

anyone?

[hodap2001]

NSLDS should show the loan currently defaulted since it is a federally backed student loan - please look at NSLDS to determine who currently has the loan. You can always consolidate this with other federally backed student loans at StudentLoans.gov - If I were you, I would try the rehabilitation route and then consolidate, but you will need to locate who is currently servicing this Perkins Loan.

[Dalton23]

@hodap

 

Thanks for your reply

 

Yes, it shows that it's in default on NSLDS. But like I said it's not reporting on any of my credit reports. If I consolidated it (without rehabbing) that'd take it out of default right? Or are you saying, it's not worth the risk...in case it eventually does pop up on my credit report?apparently it's been in default for 2 years.

[hodap2001]

Yes, if you consolidate it will take it out of default although you are taking the risk of it appearing on your credit report or not - so that is a decision that you have to make and take that gamble.

 

What are you feeling at this point on the defaulted Perkins?

[Dalton23]

I spoke with my school, it's a bit confusing. Basically there are 3 parties involved...my school, ECSI (handles loans through my school), and a collection agency. Once my loan was defaulted it was sent to a CA, after 2 years, it was transferred to another CA, and now just recently it was transferred back to the original CA. I called the CA and they said my account was closed? I than called my school, they said ECSI has been reporting it to all 3 of the CRA and that it may take time for the CA's system to update since it was just transferred...anyhow I just checked today again and still...no Perkins loan on my reports.

 

As far as how I'm going to handle this. I'd love to skip the whole rehab thing and just consolidate the loan. But it is a huge risk and I can't get a straight answer from any of the parties involved.

[hodap2001]

Well you definitely need to choose a route at this point in time...what are you leaning more towards, consolidation or rehab??

[Dalton23]

Update:

 

Just received a letter from the collection agency (ERS) my Perkins was sold too. They're saying I owe $3200. My school/Student loan data base shows the loan amount to be $1,900. Not sure how to handle this? Send them a DV letter?

 

@hodap- I spoke with my school and they claimed that ECSI was responsible for reporting to the CRA's, not the collection agency (ERS)? Does that make sense to you? If ECSI is infact responsible for reporting to the CRA's, they've been handling my Perkins for over 3 years so the odds of them randomly reporting now are slim....in this case I'd rather do the consolidation. Although this new CA is worrying me.

 

Any advice? If I consolidate the $1,900 Perkins loan, what happens to the $3,200 this new CA is saying I owe?

Edited July 1, 2014 by Seangar

[Dalton23]

Just pulled out the letter I received from ECSI from 5/1/2014 (which is how I found out about this loan), this entire situation is driving me insane. So basically ECSI and ERS are both trying to collect on the same Perkins loan? The letter says...

 

"Payoff: 2,200

 

Immediate action necessary, your account is 915 days past due! Due Diligence regulations require us to report delinquency to the credit bureau!

 

Credit Bureau rating as of the above due date: Seriously Past Due: 930 days"

[Dalton23]

anyone?

[hodap2001]

Since it's not reporting yet, I would consolidate it away from the CA and move on, but that is what I would do in your situation. It sounds as though the 1st collection agency hired by the school was unable to collect upon the debt which is why they transferred the debt to another collection agency to see if they can collect from you - this is standard with Perkins collections; however, I would be careful because this collection agency could potentially refer the account back to the Department for legal action against you - this process is called subrogation and that is when they will perform Tax Offsets and Administrative Wage Garnishment so I wouldn't wait much longer to take action.

[evapor8ted]

Since it's not reporting yet, I would consolidate it away from the CA and move on, but that is what I would do in your situation. It sounds as though the 1st collection agency hired by the school was unable to collect upon the debt which is why they transferred the debt to another collection agency to see if they can collect from you - this is standard with Perkins collections; however, I would be careful because this collection agency could potentially refer the account back to the Department for legal action against you - this process is called subrogation and that is when they will perform Tax Offsets and Administrative Wage Garnishment so I wouldn't wait much longer to take action.

 

This. Pay it off or consolidate now, before ED picks it up and begins a new reporting period. When it is been passed from CA to CA that's a sure sign it is about to be gone. Lynn used to collect these so she may have more specific insight.

[Dalton23]

Thanks for the advice guess, I went ahead and consolidated them. Apparently they wanted my spouses info as well, hopefully they aren't consolidating her loans with mine haha. Anyhow, should I still send out the DV letter to the collection agency, or just ignore them?

[hodap2001]

Good!

 

Federal Regulations prohibits the combining of spousal consolidations; therefore, this consolidation is all on your own! I would just let them know that you've requested consolidation and they will paid-off soon by the consolidation and that's it.

[Dalton23]

thanks for all your help Hodap, I really appreciate it. Lets hope this "gamble" pays off.

[hodap2001]

Good luck and your welcome!