Aargh! Deferment/Forebearance Woes!

[Jondor]

First off, thanks for this fantastic resource and everybody's participation! I am just beginning the process of repairing my credit, and look forward to posting some of my own successes and lessons learned, as well.

I have a question about retroactive deferments and forebearances. Between undergraduate and graduate school, I have about $65,000 in students loans. My undergraduate loans (about $20,000) came from Direct Loans, and my grad school loans came from Sallie Mae.

Throughout a VERY trying three years, I have managed to keep my SallieMae accounts relatively unblemished by utilizing deferments and forebearances. SallieMae has been very cooperative on this point to date.

However, after pulling my credit report for the first time in four years, I see that Direct Loans has me in default and collections on my undergraduate loans for missed payments over that same period. On each occasion when I applied for a deferment or forebearance with SallieMae, I made sure to send a copy to DOE, but they have apparently not done anything with that information!

I should have stayed on top of this better, but I've never received any mail from Direct Loans suggesting a problem, so I wrongly assumed that everything was okay. Now I need to go through the process of getting my Direct Loans out of default and my payment history revised to reflect the dates for which I had forebearance or deferment.

Any suggestions before I begin? Do I need to speak with the OC or the CA ? What are my chances of success?

[LynnInMN]

Sounds like Direct Loans doesnt have a current address for you..which probably caused you to default. If the DOE had a correct mailing address for you, you would received A LOT of mail. Once you are in default, you loose deferment priveledges and the only repurchases I have ever seen happened within the first 180 days of default, due to a DOE error.

Where you sending Sallie Mae paperwork to the DOE?? You would have to send the correct DOE paperwork to the correct address to qualify for DOE deferment. Your case does not sound like a DOE error.

At this point in time, you dont have any hope of getting this out of default. It sounds too far gone. You will need to contact the CA who is handling it and get set up on a rehab to fix some of the damage that has occured.