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Should I Poke Navient to Deal With My Old Loans?

Written by Steve Rhode


Dear Steve,

I have not paid my student loans since graduating in 1998 and 1999…after deferments then attempting to arrange monthly payments…I stopped paying after being told “If you can’t make the full payment, then it will not count as a payment.” One loan co-signed by my ex husband is up to date and almost paid.

I had over 200K of graduate school loans fall off my credit report this year due to the statute of limitations. I am assuming they were private loans. Its been so long…I can’t be sure. I would not advise anyone to do this. I did not do this knowing it would happen…I simply could not afford to pay.

I have one loan left from Navient for about 13K. I am not sure if its Federal or Private…whether it I now wish to purchase a home and this is the only blemish on my report.

My question…I would like to negotiate a settlement with them of 20% of the balance owed…$2.6K of 13.4K with the “Charged Off” notation taken off and replaced with “Paid as Agreed” or “Paid in Full”. I hear that they only settle at 45K to 50% which I don’t have. Will my contacting them risk a possible lawsuit and eventual judgment…thus messing up the decent credit scores I have now? Will this start the clock ticking again?

This debt is scheduled to fall off my credit reports in March of 2019…however I wish to purchase a home now. The other option is that I could start making monthly payments and just pay it off…which I don’t have a problem with…if the charge off notation is removed from my credit report. Also, should I be concerned about the other debt that has fallen off my credit report “reappearing”? Your advice is greatly appreciated.

I wish to purchase a home now and settle my Navient debt of $13,400. It is scheduled to fall off my credit report March 2019..however I cannot wait. I wish to negotiate a settlement of 20% at 2.6K today with the “charged off” notation taken off and “paid in full” or “settled” on my credit report with a balance of zero noted.

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I realize based on your blog…45% to 50% is more realistic. My question, am I poking the bear by reaching out and offering settlement when they can come after me with a lawsuit and eventual judgement? Is Navient open to payments…thus improving my credit score possibly and taking the “Charge Off” notation off or am I better off settling and getting a zero balance with the “charged off” notation taken off my credit report?

I just discovered your blog and its awesome and a great service to those in debt…God bless you!



Dear JT,

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You need to keep in mind that just because old student loans fell off your credit report does not mean they can’t attempt collections or even sue you anyway. A debt that is out of the statute of limitations is still eligible for a lawsuit to be filed on it. The fact it is out of statute is a defense you can raise if you are sued.

If you want to check if the loan is federal, logon to the National Student Loan Data System and if it is listed, it’s federal.

Navient will settle if you talk to the right people there. Read This is How You Can Settle Your Navient Student Loan. I would not suggest opening up the Navient can of worms unless you have a likely plan. So you’d need to do the research yourself and figure out what approach you are comfortable with or contact someone like Damon Day. an independent debt coach, to guide you through the process.

Navient will accept settlement payment over 2-3 years.

The odds are the charged off is NOT going to be removed. Your credit reports should contain a true and accurate reflection of your credit history. If you had been late in the past, that should continue to be reported.

Even if you settle a debt, the part that is forgiven will appears as charged off and you may owe income tax on the forgiven debt if you are not insolvent.

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About the author

Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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