Make Paid Loans STAY Paid – Part One
You've finally paid off another student loan! Time to celebrate, yeah?
Absolutely. Give yourself a round of applause, a cupcake, a day at the beach, whatever makes you happy. But in your haste to forget that debt, don’t throw out your proof of payment!
And don't assume that just because you've paid this loan, it will show as paid on your credit record - or on your application papers for a future loan. Mistakes are made. And you can say that twice when it comes to student loans.
Consider the case of federal government letters demanding immediate payment from people who had paid their student loans years ago. Accidents happen, and you can deal with them if you’re prepared.
So every time you pay off a loan, make an extra copy of your receipts and letter from your lender and put that in a safe place. If you're using a binder for your loans, keep receipts in a special folder. If you're filing loans, keep on for Loans Paid. Whatever works for you - just keep it.
A month or two after you pay off a student loan, check your credit records. Your credit reports will probably list all the student loans you've ever had. But they should show your paid-off ones as having a zero balance.
The details can depend on your loan. For example, a pre-90s Canada Student Loan may just show a zero balance to show that it was paid. A risk-shared Canada student loan may show the original amount owed and the date that it was paid. Whatever the system used, you need to be sure that the record shows that your paid-off loans are paid.
If you find a mistake, send a note plus copy of your receipt to have your credit records corrected.