WSJ -- 40 percent of Federal student loans behind in payments

The story wasn't difficult for me to follow.

1 in 6 are in default. They had not made a payment in more than a year. That was 3.6 million people. Which is a huge default rate for any loan portfolio.

On top of it. ... Another 3 million people were at least a month behind in their payments. And another 3 million people on top of that have been given deferments. It points out that the nonpayment rate would be much higher without a recent surge in a program for distressed borrowers that lowers their payments.

What you stated isn't true. Your payments get reported to the credit reporting agencies on a timely basis. What a late payment does to your credit score is a different story -- not that that is the mark of whether you have been timely or not in your payments, which is simply a matter of whether you are up to date. Your credit score will typically suffer from a 30 day or 60 day late payment. But the damage isn't usually lasting if it is an infrequent occurrence. When you are 90 days late, it typically causes more lasting damage to your credit score.

 

I stand corrected. The default rate is 16 percent. The number behind on their payments is more than 40 percent. I will edit the thread title to reflect that 40 percent are behind in their payments.

 

Dude, take a step back. Take a deep breath. Stop reflexively arguing for a second.

ALL OF YOUR LOAN payments (and missed payments) -- whether it is a credit card, a home mortgage, a car note, a personal loan, etc. .. -- get reported every month to the credit reporting agencies. That is what the credit reporting agencies do. They collect data from lenders and then they share the data across lenders to help them assess your credit worthiness.

What the credit reporting agencies do with the data they collect has nothing to do with whether you are up to date on your payments. You are thinking, "It doesn't hurt my credit score in a lasting way until I am 90 days late." That may or may not be true, actually.