So. I Was Denied Federal Loans Due To An Old Open Collection Forum

[SamSeaborn2016]

I wouldn't pay the full amont to the collections people. If you owe 200 offer them half, they'll probably take it. Don't tell them what situation you're in or they'll bend you over.

This could actually backfire. If they take a settlement for $100 they can still record the other $100 as a "charge-off" on the credit report, which sucks too.

My advice is to simply pay it off and request a proof of payment letter. Provide that to the student loan "folks" and you should be fine. Either they will reconsider your current application or make you re-apply after the collection agency clears the payment. The collection agency is supposed to report the payment to the credit bureaus but it can take between 30 and 90 days for the bureaus to begin reporting it. FWIW, I work in lending and underwriting.

https://studentaid.ed.gov/students/atta ... oansQA.pdf

[wowzers]

According to Michigan's financial aid talk at their ASW, she said that as far as federal loans that are credit-based (Grad Plus) it only took a one time snap shot of your credit and if everything was cleared at that point, then you'd be approved. So pay the collection agency. AT&T already sold the debt, so they don't have anything to do with it anymore. Then you can appeal the credit decision and you should be able to qualify because its checking your credit for negative items, like an unpaid debt, not necessarily a high credit score.

Well, I already applied so my one time snap shot may have been taken, and I could be sunk. Or do they look again? I'm a bit confused now. The collection was originally filed in '03, but then refiled by a different company in '05.

When was the date of your first delinquency, this is when the clock starts to tick on how long derogatory stuff can appear on your credit report. It should list it on your Equifax. It's been 7 years so this should be already off your credit report and if not it should be soon. If it's been over 7 years I would dispute the account with the credit reporting agencies and demand that they delete the trade line.

Well, 08/03 was the original date, so I'd be at 7 years just as classes start (ridiculous timing). I just paid it the other day and forwarded the confirmation letter to the peeps at the disbursement center.

[wowzers]

I wouldn't pay the full amont to the collections people. If you owe 200 offer them half, they'll probably take it. Don't tell them what situation you're in or they'll bend you over.

This could actually backfire. If they take a settlement for $100 they can still record the other $100 as a "charge-off" on the credit report, which sucks too.

My advice is to simply pay it off and request a proof of payment letter. Provide that to the student loan "folks" and you should be fine. Either they will reconsider your current application or make you re-apply after the collection agency clears the payment. The collection agency is supposed to report the payment to the credit bureaus but it can take between 30 and 90 days for the bureaus to begin reporting it. FWIW, I work in lending and underwriting.

https://studentaid.ed.gov/students/atta ... oansQA.pdf

I basically did what you said. If it doesn't work, I'll probably follow your other advice. Thanks for the input.

[wowzers]

I was approved!

[Lupton Pittman]

Congrats man; I'm sure that's a big weight off your shoulders. Hopefully I'll be in your shoes shortly.

Would you mind sharing the length of time between when you paid the debt and when you were approved? (Basically how long it took to receive the necessary receipts required by the people at GradPlus.) Also, you let me know a few weeks or so back that Equifax is the credit bureau they look to - just to be sure, is this in fact the only report they're concerned with? Thanks again for your help.

[MoS]

You would have had to contest the charges at the time. There is a proper way to do it, but 7 years later you just need to pay the bill. For GradPlus loans the credit requirements are rather lax as far as score goes, but if you have anything that is more than 2 months past due, currently, they will deny you the loan.

[wowzers]

Congrats man; I'm sure that's a big weight off your shoulders. Hopefully I'll be in your shoes shortly.

Would you mind sharing the length of time between when you paid the debt and when you were approved? (Basically how long it took to receive the necessary receipts required by the people at GradPlus.) Also, you let me know a few weeks or so back that Equifax is the credit bureau they look to - just to be sure, is this in fact the only report they're concerned with? Thanks again for your help.

Yes, I am ecstatic!

I paid the bill about a week ago, received proof from the collection agency, and then forwarded it via fax to a representative at the loan disbursement center. You'll want to call them in order to confirm that they require equifax, etc, but that's what I was told. It took a little over a week to complete all of this. I hope you have the same end result, lupton.

To recap, you'll need to call the disbursement center, find out what your next steps should be, follow them completely and complete them ASAP, and then wait. That's about it. Good luck bro!

[CanadianWolf]

I have not read all of the posts in this thread, but I encourage every reader to obtain current copies of your credit reports from TransUnion, Equifax & Experian. You may be shocked at what you find or don't find.

[UF Gators]

Congrats man; I'm sure that's a big weight off your shoulders. Hopefully I'll be in your shoes shortly.

Would you mind sharing the length of time between when you paid the debt and when you were approved? (Basically how long it took to receive the necessary receipts required by the people at GradPlus.) Also, you let me know a few weeks or so back that Equifax is the credit bureau they look to - just to be sure, is this in fact the only report they're concerned with? Thanks again for your help.

When I applied the other day they only pulled my transunion report. I guess it's random.

[wowzers]

Congrats man; I'm sure that's a big weight off your shoulders. Hopefully I'll be in your shoes shortly.

Would you mind sharing the length of time between when you paid the debt and when you were approved? (Basically how long it took to receive the necessary receipts required by the people at GradPlus.) Also, you let me know a few weeks or so back that Equifax is the credit bureau they look to - just to be sure, is this in fact the only report they're concerned with? Thanks again for your help.

When I applied the other day they only pulled my transunion report. I guess it's random.

Weird. I was told to send a full copy of my Equifax report along with proof of past due repayment. Huh, weird.

Anyway, I hope everything works out for everybody. I'm pretty excited. Waiting a year would have sucked, and getting my school to allow me to defer because I'm a dead beat (not really, but it would have appeared so) would have been difficult.

[Sparkz1920]

You would have had to contest the charges at the time. There is a proper way to do it, but 7 years later you just need to pay the bill. For GradPlus loans the credit requirements are rather lax as far as score goes, but if you have anything that is more than 2 months past due, currently, they will deny you the loan.

I have four old accounts from undergrad. I paid all of them and the collection agency updated them, before i got the collection agency to delete the account. however, the original creditor, 2 Cap One, Express, Plains Commerce Bank account are all shown as charge offs. Now ive been working to repair my credit, so that might be why. Sure enough i was approved instantly. My score is also a 665 do that might hsve made a difference.

I had no issues though, so im sure they are very lax when it comes to cedit. Ive been denied for credit cards but yet i still got a GradPlus Loan.

[too old for this sh*]

I have not read all of the posts in this thread, but I encourage every reader to obtain current copies of your credit reports from TransUnion, Equifax & Experian. You may be shocked at what you find or don't find.

It is also worth getting a copy of the Innovis report. More and more people are reporting finding accounts getting reported over there. The jury is still out on who is pulling from Innovis for any of the underwriting decisions, but it would really suck to fix the big three and then get hosed because of the 4th major that went untouched.

There are boards that deal exclusively with credit-related stuff including extensive discussions on the pay-for-delete concepts. Avoid the boards where the first words out of people responding to almost every thread are "just sue them, they'll delete it to make you go away." That may have worked years ago, but does not work in the present climate. There was a funny thread on one of the boards about an idiot in Dallas who not only acted a fool but also gets to pay sanctions.

[TaxLaw2010]

To all those that have been denied for Grad Plus upon first applying, there is hope! I was originally denied, but I appealed the credit decision. I just got the call a few minutes ago, and I was approved, and they are sending the credit over-ride decision to my school! Thank God!!!! Law school is now an eminent reality for me! I was worried, because I still had a couple of unpaid collections (medical and one other recent account), but all my charge-offs were paid/settled. Apparently they do not look at collections anymore, which isn't surprising in the economy.

Good luck to all those still waiting! Have faith! It can be done!