Charged off accounts and Graduate plus loans

[metformin800]

Hey guys,

Although i am pre pharm, i have been reading lots of post regarding bad credit and grad plus loans on this board. I am going through something similar thought i would post here to get some feedback on my situation.

So i just got accepted to pharm school but school is very expensive so i would be needing graduate plus loans but i know for sure i wont be approved because i have 2 credit card account which are charged off from 2013 sitting in my credit report. The accounts were closed. I am still in school fulltime and i dont work many hours, so i am not in position to pay that off in full. However, i was able to reach settlement on one card, its still in process though. The settlement is not full amount but they say that once i made payment my account will be closed forever from debt collection.

For second account, i have been getting calls from collector but haven't picked up yet as i know i wont be able to make payment. Most likely they want full amount but i will try to talk them to see if they can do any settlements. I know i need to act quick. My program starts in summer and i need to apply for grad plus..

Besides those two, most of my current bills are paid in full and on time. Heck i was just approved for macy's card lol. Other credit card companies are also sending me pre approved offers. I have great rental history and my phone bills, electric bills, insurance bills are also paid on time ..

Although i haven't applied yet its already giving nightmares about not able to attend school.. Has anyone been in same situation???? Last resort would be to ask my parents to cosign for me but i don't want that too happen as they don't know about charged off accounts..Sorry for long post..

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[qwert876]

I'm sorry that I can't give advice about your specific question.

However, never give the credit card companies or debt collectors electronic access to your checking account. Always send a check or money order. And also make sure you get the settlement agreement in writing. They will lie to you. These people are scum. You can tell they're lying if their mouth is moving.

Here is how they will lie and scam you:

Let's say you owe $4,000 with a minimum payment of $100 per month (Just making up numbers). They'll verbally agree to settle for $1,000 and all you have to do is let them automatically take it out of your account and you will never owe another dime. Then the next month they will take another $100 from your account. When you call them, they will say that you made a one-time payment and you still owe $3,000. DO NOT TRUST DEBT COLLECTORS. If it's not in writing, it didn't happen.

 

[Ismet]

1) First and foremost, stop opening credit lines, make a budget, and don't rack up credit. Have one main card that has a good interest rate and good perks (Discover is great) and have a backup card for emergencies (like a Visa or MasterCard for the few places that don't accept Discover). Don't open a credit line just because you got the offer or because it gives you certain perks at a certain store. You're a full-time student and will be for the next 4 years, you cannot be frivolous with spending. If you're accruing debt and not making enough money to pay that debt, there's no need for a Macy's card or a store-specific card. Those just encourage more unnecessary spending, and their rates usually aren't that good.

2) Read up on GradPLUS. It sounds like you have an adverse credit history, and just settling these accounts won't erase that (it's an adverse credit history within the last 5 years). You'll likely have to have your parents take out the loan or co-sign it. You sound worried that they'll be mad about the accounts, but them's the breaks of being an adult and owning up to mistakes. It sounds like you've gotten better about keeping things paid off, so maybe that will buffer the blow.

3) Talk to the financial aid office at the school you'll be attending. They may have more information to help.

 

[metformin800]

1) First and foremost, stop opening credit lines, make a budget, and don't rack up credit. Have one main card that has a good interest rate and good perks (Discover is great) and have a backup card for emergencies (like a Visa or MasterCard for the few places that don't accept Discover). Don't open a credit line just because you got the offer or because it gives you certain perks at a certain store. You're a full-time student and will be for the next 4 years, you cannot be frivolous with spending. If you're accruing debt and not making enough money to pay that debt, there's no need for a Macy's card or a store-specific card. Those just encourage more unnecessary spending, and their rates usually aren't that good.

2) Read up on GradPLUS. It sounds like you have an adverse credit history, and just settling these accounts won't erase that (it's an adverse credit history within the last 5 years). You'll likely have to have your parents take out the loan or co-sign it. You sound worried that they'll be mad about the accounts, but them's the breaks of being an adult and owning up to mistakes. It sounds like you've gotten better about keeping things paid off, so maybe that will buffer the blow.

3) Talk to the financial aid office at the school you'll be attending. They may have more information to help.

Thanks, i was freaking out for no reason, it got approved with no need of cosinger. I must add i paid off my one account and now paying off second one.