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- Mar 23, 2016
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http://www.studentloanborrowerassistance.org/new-rules-plus-loan-credit-checks/
Under the new rules effective March 29, in determining whether there is an adverse credit history, the Department will consider whether the applicant has one or more debts with a total outstanding balance greater than $2,085, debts that are 90 or more days delinquent as of the date of the credit report, or that have been placed in collection or charged off as defined in the regulations during the two year preceding the date of the credit report, OR if the applicant has been the subject of a default determination, bankruptcy discharge, foreclosure, repossession, tax lien, wage garnishment, or write-off of a federal student loan debt during the five years preceding the date of the credit report. This last category is the same as the current regulation.
Soo according to this, having a current debt balance of > $2,085 at the time of the loan request will be grounds for an "adverse credit history" resulting in the loan being denied.... can anyone confirm that this is the way it is now? if so it seems pretty ridiculous that having a car loan and some credit card balances will make it impossible to get a Grad PLUS loan (without a cosigner because thats a no-go in my case at least), despite a 100% payment history, ~700 FICO score and no serious credit dings. As a non-trad it seems pretty normal too have open debt/loans equating to > $2,085, so I'm finding this hard to believe, and quite worrisome if it is true.
Under the new rules effective March 29, in determining whether there is an adverse credit history, the Department will consider whether the applicant has one or more debts with a total outstanding balance greater than $2,085, debts that are 90 or more days delinquent as of the date of the credit report, or that have been placed in collection or charged off as defined in the regulations during the two year preceding the date of the credit report, OR if the applicant has been the subject of a default determination, bankruptcy discharge, foreclosure, repossession, tax lien, wage garnishment, or write-off of a federal student loan debt during the five years preceding the date of the credit report. This last category is the same as the current regulation.
Soo according to this, having a current debt balance of > $2,085 at the time of the loan request will be grounds for an "adverse credit history" resulting in the loan being denied.... can anyone confirm that this is the way it is now? if so it seems pretty ridiculous that having a car loan and some credit card balances will make it impossible to get a Grad PLUS loan (without a cosigner because thats a no-go in my case at least), despite a 100% payment history, ~700 FICO score and no serious credit dings. As a non-trad it seems pretty normal too have open debt/loans equating to > $2,085, so I'm finding this hard to believe, and quite worrisome if it is true.
