Ok, allow me first to say that the headline was just an eye catcher to get you to read this article/blog, it’s not like the government is TRYING to scam you.

Or was it?

Let’s break it down for you and everyone out there. As stated in the past at this point I have review approximately 16,000 credit reports in my now 11 years of experience of the credit repair/restoration/management industry.

What amazes me is when I come across a client who has listed 5-20 student loan accounts on their credit and they range from $200- 20,000.00. I have even seen some reporting on a credit file where no payments were ever made and showed what seemed to be a $70.00 loan.

REALLY?? A $70.00 student loan??

Why the department of education and the other student loan lenders out there do not consolidate the loans into one once school is complete is truly beyond me, OR at the very least once school is completed. Many times if a consumer is negligent in paying the bill due to whatever reason then the consumer now has 9 negative slow pays (if they have 9 accts reporting) on their credit which is DEVASTATING to their credit as opposed to if the accounts were consolidated into one account with the creditor.

The other thing to point out is we NEED to get consumers out there to identify this horrible potential to destroy their credit file and get PROACTIVE, after all knowledge is power!

So what can you do?

FIRST thing is to contact the lender and understand the first person you will talk to is a customer service representative who has little to no authority to do anything that can help you for what you truly need. You NEED to be proactive when approaching this situation.

Now this is not a knock against customer service representatives but in my experience the bad ones (meaning ones that don’t care) greatly outnumber the few goods ones out there.

In my experience I have never come across anyone who has made the job of customer service as a career. In my experience they are poorly trained (try googling Comcast customer service complaints) or they just don’t care as it’s a 9-5 job.

Most student loans are federally guaranteed by the department of education. But don’t expect them to be leaping to help you by any manner. Understand that this is your life and your responsibilities so you need to be proactive in this and as you’re the only one who truly gets affected by this so it’s in your hands.

Your credit score needs to be good in order to do this, typically a 660 on average. Check with your current bank to see if they offer student loan consolidation. If they do then have your credit reports with you and layout just how many active “student loan accounts”.

What you want to do is limit risk if something happens and eliminate the ability to let something slip by.

NOTE: I had a client one time who had three 150.00 student loan accounts they had no clue about. And then of course something slipped by and now they had 3 negative accounts reporting current 90 day late payments. Destroying their credit for at least a year and that is with credit repair help.

Now when you Consolidate loans typically you increase the length of time the loan is paid back which of course means smaller payments but MORE of them. So you need to look at this in the same way you look at a home loan.

If they give you a 30 year payment plan ask for a amortization schedule of the loan repayments so you can see exactly how much money every month is going towards principle and how much goes towards interest and at least now you have an idea where you money is going.

And with proper planning you can identity if you make 1 extra payment per year or a few dollars extra per month how much that can lower the total time frame of paying off the student loan.


  1. Depending on your career some allow your student loans to be greatly reduced and even forgiven. Click on the link below to see


  1. You CANNOT discharge your student loan debt by filing bankruptcy as a whole, but there are cases where it can happen. Check out the link below to see some examples and if they correlate to you.


  1. Student loans can file to have a portion of your paycheck withheld as well as your tax returns. (Individual states may vary so check with yours).

NOTE: the links I have attached are for informational purposes only and I take no responsibility to their reliability. They are merely for a measuring stick to guide you some possible tools to help you the consumer.

Want to learn more about how the world of credit works? Contact me today and get my book in full blown color. No nonsense direct answers and easy to understand.

how the “Real world of credit” works. wayne@waynethecreditguy.com

And of course if you need some credit work to increase your credit score then call me today to discuss!