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Posted in Student Loans
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JB519

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Bad student loan debt: Just how BAD is it?
I have a poor credit rating due to having several closed student loan accounts that were never paid off. Some were private loans while others are state/federal, but all say "student loan" on the report. I have no other negative marks on my credit. I realize this isn't good, but it has to count for something that I don't have a history of negligence with every day purchases/payoffs, right?

I am looking to buy a home in the next few years, but based on everything I've read, it could take up to 10 years for the marks to be removed. Is it possible that through positive marks (opening up lines of credit with a positive payment history, paying off old debts in collection, etc) I could get approved for a home loan even with these marks on my report? I

I have been so afraid to face my credit score that I honestly haven't even thought about any of this until now and I certainly didn't do my research. Can anyone weigh in? Any information will likely be more than I already know.

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Defaulted student loans are never good. How old are they? My advice is to contact the lender(s) and come up with a payment arrangement. After 6 or 9 months (can't remember which) of "satisfactory payments", that default will be cleared. It may still show on your report as having missed payments, but it's the "loan default" mark that would sink you. Any lenders see the word "default" and run the other way.

Get that cleared up BEFORE applying for a mortgage. And yes, absolutely get some positive marks on there.

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