MAINTAINING A POSITIVE CREDIT PROFILE

CREDITWORTHINESS: Most private sector loan programs require an independent credit review of student applicants. Guidelines generally parallel normal lending standards for the extension of personal credit. Factors considered include a history of timely repayment and sufficient financial resources to meet monthly obligations upon graduation or other departure from school.

CREDIT CRITERIA FOR PRIVATE LOAN PROGRAMS: A lender will generally make you a loan provided your credit report meets the lender’s credit criteria. These are not the Office of Student Financial Service’s criteria but rather those of lenders.

No more than one account currently rated sixty or more days delinquent at the time of the credit report.
No more than two accounts that have been sixty or more days delinquent in the past two years.
No account that has been delinquent ninety or more days in the past five years.
No record of paid or unpaid collection or charged-off account in the past two years.
No record of foreclosure, repossession, open judgement or suit, unpaid prior educational loan default, or other negative public credit record items in the past five years.
No record of bankruptcy in past ten years.
No more than three inquiries to an authorized credit reporting agency in the past six months.

REQUESTING A CREDIT REPORT: Students are advised to request a credit report periodically to insure its accuracy and completeness. If problems exist, you should correct errors or make other arrangements with creditors before submitting loan applications to this office.

When requesting a credit report, send a written, signed letter including your full name, social security number, date of birth, daytime telephone number, current address, and copy of driver’s license. You may request a credit report from any of the three credit reporting agencies:

Equifax Credit
Information Services, Inc.

Trans Union LLC Consumer Disclosure Center

Experian

P.O. Box 740241
Atlanta, GA 30374

P.O. Box 1000
Chester, PA 19022

P.O. Box 2002
Allen, TX 75013

1-800-685-1111

1-800-888-4213

1-888-397-3742

www.equifax.com

www.transunion.com

www.experian.com

Beginning September 1, 2005, all consumers will be able to receive free credit reports once a year under the Fair and Accurate Credit Transactions Act of 2003. Consumers can request, view, and print one, two or all three free credit reports on the secure website www.annualcreditreport.com. Consumers may also request their free credit reports by telephone at (877) 322-8228 or by written request to Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281.

RE-ESTABLISHING CREDIT: The Office of Student Financial Services can advise students on how to reestablish credit. However, it is the student’s responsibility to establish dialogue with creditors, lenders, and guarantee agencies to clear up any credit problems. These parties cannot discuss credit information with anyone but the applicant. Be aware that correcting your credit profile may take weeks. If you would like assistance, please make an appointment to meet with one of our staff.

STUDENT LOAN DEFAULTS: Default on an educational loan occurs when you fail to make payments during the required repayment period or fail to provide adequate proof of an approved deferment. You can avoid default by making payments on time or by submitting deferment forms to your lender in a timely manner. Should you be in repayment and experiencing cash-flow problems, contact your lender to ask for forbearance or a graduated repayment schedule. Although some loan programs do not provide deferment or forbearance options, most loan programs will make accommodations for hardship or unemployment. Rather than have a student default, most lenders are willing to work with students.

Default is avoidable. It requires careful planning about lifestyle choices and your ability to repay throughout the repayment period. Continuing to live on a modest budget and making sound financial decisions will lessen the burden of debt repayment upon graduation.

CONSEQUENCES OF DEFAULT: These consequences vary by loan program and can be verfied with your lenders. Some of the consequences of defaulting on your student loans are:

Defaults are reported to credit bureaus as delinquent education claims.
You may be disqualified from receiving consumer credit such as credit cards, car loans, and home mortgages.
You will be unable to obtain future educational loans and other federal financial aid from any institution. At this institution, if the default is discovered after aid has been awarded, the student has four weeks to resolve the default before aid is canceled.
You will be ineligible for other types of government loans such as Small Business Administration (SBA) loans or federally subsidized mortgages.
Involuntary deductions will be made against your wages.
Federal and/or state income tax refunds will be withheld.
The entire amount due on your loan plus interest may become immediately due.
Your account may be assigned to an agency, which will impose collection costs, late charges, and attorney fees.