Student Loans Depart of Ed

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This topic contains 2 replies, has 3 voices, and was last updated by  TTrumble 1 month, 4 weeks ago.

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  • #47892

    Kchase
    Member

    Hello I am looking for some advice. What happens if I have about 8 student loans I have not paid since 2016 or earlier. I have had these loans since 2006-2009. I have gone from paying to not paying to having them garnish my wages. After about 2 years they stopped garnishing my wages. My credit report still shows that I owe money. I am unsure of my balances. My current credit report does not show any balances. I also had one fed loan as well which does report the balance. Recently I went to go obtain my transcript just update my current job of my accomplishments and what kind of schooling which was ITT Tech and I have learned they are NO lONGER IN BUSINESS. Not only have I never used my schooling but now I can not obtain any records showing I went to school. I can only show I have loans that I am no longer paying for. Will this be a huge obstacle with NACA? Can someone share they experience or give me some insight with what I would have to go through? Thank you.

    #47923

    I haven’t had my first meeting with my MC but I can tell you that if you are in default (based on the handbook) you may need to get that taken care of – possible a loan rehab if available. There may not be a balance but it could be reporting as a collection on your CR. Also if you go through credit repair and decided to FHA the lender will come across your loans likely around the appraisal part of the process (if the loans were issued by the government).

    I would just be prepared to discuss it in detail with your MC.

    #47998

    TTrumble
    Member

    Hello Kchase,

    From your description, you may well have some problems regarding the student loans. First, you have a mystery on your hands even regarding the status of the loans. You need to contact the servicer of the loan and find out what’s going on and how much you still owe. If you are in a status other than current or forbearance, you will have to resolve the situation before you can be approved. What it will take to resolve the situation will depend on the individual circumstances, and your counselor will advise you on how to take care of it.

    Actually, we understand very well where ITT Tech was concerned. We actually played a small part in their closing. Stories like yours were far too common with ITT Tech grads, paying a huge amount and going deep into debt for an education that wound up being mostly useless. In 2015, our Student Debt Action program approached Putnam Investments, a major shareholder in ITT Tech (AND their largest student loan investor) and asked them to divest themselves of ITT Tech because of their predatory student lending, outrageously low graduation rates (less than one third) and false promises of job placement. In September 2016, the Department of Education no longer allowed federal student loans for ITT Tech, and shortly thereafter ITT Tech closed the doors on all their campuses.

    Bottom line is you are going to have some homework to do regarding those loans, but at least this homework will have benefit for you by helping you get one step closer to becoming a homeowner.

    Tim Trumble
    Online Operations, NACA
    ttrumble@naca.com

    • This reply was modified 1 month, 4 weeks ago by  TTrumble.
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