How to Remove a Federal Student Loan
The U.S. Department of Education offers federal student loans to pay tuition fees. Don't neglect paying back the loan, or it will be reflected in your credit report. In that case, the Internal Revenue Service can keep your tax refunds until the loan is cleared. However, you can still remove it from your credit report.
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Instructions
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Call the U.S. Department of Education (DoE) at (800) 621-3115. Ask to talk to a representative from the default collection department to determine your default status. Default status occurs when you have failed to repay the federal student loan for more than 270 days.
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Ask the DoE what lenders currently hold your loan. Once you have failed to repay the loan for more than 270 days, the U.S. Department of Education may refer your loan to your state's guaranty agency or hire private collection agencies to collect defaulted student loans. Request for your credit report from the collection agency involved.
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Peruse your credit report and evaluate your student loan accounts to establish whether there is any inaccurate information. Write down the outstanding balance, name of the collection agency, your account number and other relevant details such as the amount you last repaid.
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Contact a customer care representative of the U.S. Department of Education once again. Ask him to assist you in determining how you will make the repayments. If you decide to use the monthly payment plan, ensure that you can afford the amount you agree to pay. The U.S. Department of Education and all state guaranty agencies accept monthly payments that you can afford.
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Ask the representative from the default collection agency to send you a confirmation letter that states the due dates for each payment, current balance you owe, and most importantly, the terms of the payment agreement. Make timely payments until you clear all the balances.
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Request for a paid-in-full letter when you clear all the balances. This letter will serve as proof that you fulfilled the terms of payment agreement.
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Order your credit report once again to confirm that your federal student loan has been removed from it. Usually, the default status will be removed from your credit report between 30 and 90 days once you have cleared your student loan.
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