Key Takeaways from Our Latest Webinar

Student loans can be complex, but understanding your options is crucial to making informed financial decisions. In our recent webinar, we tackled some of the most pressing concerns borrowers have about student loans, loan forgiveness, and how they impact homeownership. Below is a summary of the discussion, including key questions raised and the expert answers provided.

📺Watch the full webinar recording here: [LoanSense Webinar - April 2, 2025]

Key Questions & Answers

❓Q1: Can you remind me of the turnaround time on this (getting the underwriting document)?

✔️A1: Currently, servicers are advising a processing time of 30–60 days due to longer processing times. However, in the specific case study discussed—obtaining a Repayment Schedule Notice—the turnaround time was 15 days. In that case, the paperwork was submitted on March 6th, and the letter was dated March 21st.

❓Q2: I have a client who has a student loan serviced by Aidvantage, and now it shows closed on her credit report. It lowered her credit scores. She thinks they were forgiven. Maybe a new servicer? (what happened to those loans?)

✔️A2: Several things could have happened to the loan. It may have been transferred to a different servicer, forgiven, or reported incorrectly—either by the servicer or the credit bureau. To get clarity, we recommend that the client log in to StudentAid.gov, download their "My Aid" document, and review the details. This document serves as the source of truth, displaying the current loan balance and servicer.

Based on experience, very low balances may have been forgiven, or the servicer may have changed without proper notification. Obtaining this document will provide confirmation.

• If the loans have been forgiven, the loan officer does not need to include them in the DTI calculation.
• If the loans were reported incorrectly, LoanSense can assist by liaising with the servicer or credit bureau to request a correction.
• If the loans were transferred to a different servicer, the borrower can identify the new servicer through their My Aid data.

❓Q3: How long does it take for servicer and credit reporting to reflect?

✔️A3: It typically takes 30 to 60 days, sometimes more, for servicer updates to reflect on credit reports. However, it was emphasized that getting the correct documentation from the loan servicer is more important for mortgage closing than waiting for credit updates. Having the correct documentation means you would not need to wait for these payments to reflect from the credit report.

❓Q4: How should Mohela duplicates on tradelines be handled?

✔️A4: If Mohela loan duplicates appear on a credit report, obtaining a full loan summary directly from the servicer can resolve the issue. Underwriting can use this document as the source of truth.

If a credit bureau update is required to correct the discrepancy, LoanSense can provide the necessary documentation to support the correction process.

❓Q5: Does getting into an income driven plan create a new trade line?

✔️A5: No, getting into an income-driven repayment plan does not create a new trade line. It simply lowers the monthly payment on the existing loan. Refinancing or consolidating loans would create a new trade line, but income-driven plans do not.

Watch the Full Discussion

For a deeper dive into these topics and more, watch the full webinar recording here:

[LoanSense Webinar - April 2, 2025]

Ready to Learn More?

If you’d like us to present to your enterprise, schedule a demo here.
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