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I need help with a credit dispute with Sallie Mae

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Latest post Wed, Jul 13 2016 9:52 PM by karen2222. 2 replies.
  • Wed, Jul 13 2016 4:14 PM

    • smfml1
      Consumer
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    • Joined on Wed, Jul 13 2016
    • VA
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    I need help with a credit dispute with Sallie Mae

    TL:DR  We got put on a special program with lower monthly payments. We paid the agreed lower payment but our credit still got dinged. We were unaware that we had to make a full payment (as stated in the original contract when the loan was taken out) in order to avoid a late payment on our credit report.

    Is it possible to remove this negative mark? How? More details below...

     

    I am a cosigner on the loan and the primary borrower has struggled to make payments but has gotten by so far without any serious repercussions. In June, payments got really late and I was ready to step in to save my credit. However, SM offered to put us in a "special program" with lowered payments.

    The payments would remain lowered for two years but there is a 3 month transition period in the beginning. I was not aware that this 3 month period was a catch 22. If we submitted a full monthly payment (i.e. as stated in the original contract) we would get kicked out of the program. If we submitted the lower payment during those three months, our credit would be damaged because it was not a full payment, as stated in the original contract. It was my understanding that if we made lowered payment, it would satisfy as the full payment for that month and the account standing would be current rather than past due. As you may have guessed, I got a ding on my credit report and my score dropped over 130 points.

    If I had known that my credit would have been damaged, I would have never entered the program and I would have paid the amount due. I called Sallie Mae and they basically said there is nothing they can do to change the negative marks on our credit reports. I recently made a payment and brought the account back up so it is current and no more marks will go on my credit report.

    I honestly feel cheated and deceived by SMs actions of not disclosing the consequences of joining their "special program." SM made it seem like they were helping us because they saw that we were struggling. They gave no indication that our credit WILL be damaged as a result of agreeing to their new conditions. Additionally, SMs actions of placing a new subcontract within the original contract were very confusing because it resulted in two different payment requirements. In the end, I got mark on my credit that will stay on for years and a late payment because of this fiasco. I feel SM purposefully deceived us so that the length of the loan was extended and interest continued to accrue during that time. Additionally, SM continued to nickel and dime us by issuing late payment fees even though we made a payment as agreed under the special program. When the primary borrower called SM to discuss these issues they could not clearly explain why we received a mark on our credit and threatened to kick her out of the "special program." It took several calls to SM before we clearly understood what happened.

     

    I would like to know what options I have going forward to remove the negative mark on my credit and the late payment fee. 

  • Wed, Jul 13 2016 5:37 PM In reply to

    • DOCAR
      Lawyer
    • Top 25 Contributor
    • Joined on Sat, Dec 9 2000
    • NV
    • Posts 5,478

    Re: I need help with a credit dispute with Sallie Mae

    You can dispute it with the credit reporting agency and give them your version of what happened.  They will contact SM and get their version and make a decision.  

  • Wed, Jul 13 2016 9:52 PM In reply to

    Re: I need help with a credit dispute with Sallie Mae

    smfml1:
    I would like to know what options I have going forward to remove the negative mark on my credit and the late payment fee.

    Did the lender provide a written modification to the original mortgage note for you and the borrower to sign?  If so, your first logical step would be to read that paperwork to see what it says, since anything in writing with your and/or the borrower's signature would control over anything said over the phone or promised in email etc.

    Other than that, I don't know about the late payment fee, but here's a link to the Fair Credit Reporting Act, which describes your rights in dealing with the three credit bureaus.  The section on disputing things in your credit file starts on page 50.

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