Legal Question in Credit and Debt Law in North Carolina

My student loans have been in a forbearance since I've been out of school. They went into repayment and I didn't receive a call, letter or email telling me that I was in repayment status. After 60 days they reported this and it is now on my credit report. Seeing as I wasn't informed that my loans were going into repayment, how can I get this removed from my credit report? It was reported in December 2012. It's June 2013 and I'm just now finding out about it. My loan company is saying that they did send out letters and emails and attempted to call (all untrue) except for a call I received in January 2013 when I put the loan back into a forbearance. I was not informed at this time that it had been reported. Please help!

Asked on 6/21/13, 1:18 pm

1 Answer from Attorneys

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I do not see why it was the lender's responsibility here or why the information would be inaccurate. They were your student loans. Forbearance periods are usually granted for 6 months after graduation. You knew or should have known that the forbearance period would end and that loan repayments would be begin. What did you do when the period was about to end? Did you contact the lender? Did you think that because you were not contacted it somehow excused your duty to pay?

Student loans are horrible. They stay with you until death or unless discharged in bankruptcy and even then they are only dischargeable IF there are special circumstances. Just failing to pay is not one of them. Federal student loans can garnish your pay without court action if you do not voluntarily enter into an arrangement. Private lenders have to first get a judgment against you.

Instead of worrying about credit, I would see whether you can get a repayment set up. Possibly, if it truly was the lender's fault, you might get them to change the information. But they are not going to be very willing to do that if you are not paying at all.

Information that is inaccurate or stale (meaning it antedates the report by 7 years - which does not apply in your case) can be challenged and removed from a credit. What is required is that you send a certified letter challenging the information to the credit bureaus. The credit bureau sends out a form to the lender; if the information is verified the information stays on your report. The credit bureaus are to remove it if the information is not verified. However, nothing stops the lender from putting it back on.

If the information is verified, you would next send a dispute letter to the lender via certified mail.

As I said, the information from your posting suggests the information is accurate - your forbearance period ended and you did not begin to repay your loan so I don't see any grounds for removal.

However, I would try writing a letter to the lender, explaiming the mishaps and asking if they would consider amending your report to something neutral like "pays as agreed" if you begin your payments (and pay up the defaulted past due amounts or a good chunk of them). If your circumstances are such that you cannot afford to pay what they are asking then ask for reduced payment options. Many lenders have hardship programs and will base on your income (say 10% - 15% in payment). You can only ask and see what they say.

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6/21/13, 10:13 pm

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