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Is paying off defaulted loans that aren’t on my credit report going to help my credit score?

I owe $9,000 in student loans. They just started garnishing my wages for $500/month. The loans were from 1998 and do not appear on my credit report. The collection company told me that once they’re paid off that they will appear as not in default on my credit.

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4 Responses to “Is paying off defaulted loans that aren’t on my credit report going to help my credit score?”

  1. yahoooo! said:

    I’m sure it won’t. The credit bureaus are also people. They will probably ask you for the full story why you defaulted on it, if you have a very logical alibi (written proof) that you will give them when the time comes that you will apply for a loan, with your stable job and the rest of your bills, are paid on time this will pull themselves up together.
    Don’t be afraid or worry on this too much – Just keep an open account that you could purposely maintain for a while – this will show the lender or bank that you are a very good creditor.

    Life is full of unexpected difficult situation sometimes we have to face and they understand that. You just have to prove them. OK?

  2. Delaina77 said:

    If you have pulled all three of your credit reports and it’s not on there then they are BSing you. If it’s not on there it can’t help you or hurt you. They just want their money.

  3. H. A said:

    Yes, it will help, if not now, later. Eventually, they will be reported to the credit bureaus and believe me when I say they will. By paying them off now, you will eliminate any future negativism’s from being reported. Be sure to get a satisfied in full receipt and a letter stating that the loans were paid in a satisfactory manner. They want the money they will give you this type of letter. If they won’t then you may have some problems down the road, but with this letter, you can always override their negative reporting, if it were to happen in the future.

  4. Studly said:

    If they are garnishing your wages, that means they have gone to court and received a judgment. Those are public records and will eventually get placed on your credit report.

    Paying the debt off will not get a judgment removed form your reports, but it will show it was paid off. The effect to your score will be minor…..judgments hurt your score badly for a few years, whether paid off or not.


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