Private Student Loans Listed as Bad Credit

[mteinert]

What is the name of your state (only U.S. law)? Colorado

I have four Sallie Mae Private Student Loans, along with my Federal Subsidized and Unsubsidized loans. I recently applied to get a home loan and found out I am unable to get credit for a home due to the Private Loans, despite the fact that I am employed, have a Master's degree, make all payments on time, and have very low credit balances. My private loans are all listed like a credit card. One is listed as "over limit" and the three others are listed as being right at their limits. This makes it look like I am an out of control credit card user. Are these Private Loan companies through Sallie Mae allowed to list student loans as if they are credit cards? I know for a fact they never told me when I got the loans that getting them would prevent me from being able to purchase a house ... or even a car. The four loans only add up to $10,000.00, but it was money desperately needed as a student supportive herself through college without assistance from family (I was the first in my family to go to college). Does anyone know a way I can fix this?

 

[Zigner]

What is the name of your state (only U.S. law)? Colorado

I have four Sallie Mae Private Student Loans, along with my Federal Subsidized and Unsubsidized loans. I recently applied to get a home loan and found out I am unable to get credit for a home due to the Private Loans, despite the fact that I am employed, have a Master's degree, make all payments on time, and have very low credit balances. My private loans are all listed like a credit card. One is listed as "over limit" and the three others are listed as being right at their limits. This makes it look like I am an out of control credit card user. Are these Private Loan companies through Sallie Mae allowed to list student loans as if they are credit cards? I know for a fact they never told me when I got the loans that getting them would prevent me from being able to purchase a house ... or even a car. The four loans only add up to $10,000.00, but it was money desperately needed as a student supportive herself through college without assistance from family (I was the first in my family to go to college). Does anyone know a way I can fix this?

Yes, pay more than the minimum required payments. When the loans are paid, you should be fine.

 

[bigun]

I'd demand {in writing} an explanation of why they're listed as over the limit.
Never seen that before. What does your payment history look like? Any lates or defaults that may have generated any fees?
Just guessing here but, you may be misunderstanding what your mortgage lender is saying. It may not be the way these loans are listed but, the balance outstanding is hurting your DTI ratio.
Pratically all lenders are following FHA guidelines that suggest no more than 32% of net income monthly income should be spent on housing.
Point is, with fewer players in the mortgage market and,lenders choking on foreclosures there is a lot more than credit scores involved in a mortgage underwriting decision.

 

[mteinert]

Frustrations

I sent an email to Sallie Mae asking them about the situation. They replied I could only ask my credit report to be ammended by letter, so I faxed them a letter today. I will see what they say next.

I have been set up with automatic payments with Sallie Mae, so the payments get to them on time every month, although the first year after I graduated I had to stay in default while I got on my feet with a career. That was back in 2003 though.

I know it might just be an administrative error, it was just very shocking to find out my choice to go to college, as the daughter of lower middle class parents who could not pay my way through, came back to shoot me in the back! My partner who did not go to college and makes $15,000/year less than me was told she is approved for a loan, but it is quite a bit lower than most quality homes in Denver go for ... it was quite upsetting although I am glad we can at least use her credit for a home if needed. I still have to fix my problem, though, because it looks so bad right now I cannot even get credit to purchase a vehicle. I am glad my 2000 Toyota is still running smoothly!

The way the loans are listed, it has "date reported" "date opened" "high credit or limit" "balance" "past due", etc. in columns.

The first SM Private Loan is listed as "High Credit or Limit" $2112.00 with a "Balance" of $2301.00 ... so it looks as if I am over limit or not paying even though no late payments are reported. The other three private ones are all very close to their stated "High Credit or Limit." The Federal Subsidized and Unsubsidized loans are ok even though they take up the bulk of my student debt.

If I have to, I can transfer the private student loan debt to an open credit card my dad has and just pay him back, but then I lose the lower interest rate through Sallie Mae and I cannot claim interest paid on my taxes ... but I make the debt invisible.