Can Student Loans Affect Your Credit Score?
Student loans are debts owed to a lender. So they will help your credit score, provided you pay on time. Your on-time payments will be reported to the three major credit bureaus and will boost your credit score. So as long as you keep up with them, you will be in good shape when you decide to buy your first home.
Do Late Payments Hurt Your Credit Score?
Since student loans function much in the same way as other debts, late payments will indeed hurt your credit score. There are a few caveats to this, however. The time frame before your missed payment gets reported will depend on whether your loan is a government one or a private lender, the time frame before reporting may vary.
Sometimes, lenders will wait for as much as 90 days before they report you as late. And during this time, they will reach out regularly to help you stay on top of your account. Once they report the missed payment, it gets recorded as delinquency, which remains on your credit report.
Additionally, your student loan will default if you are more than 270 days late. A defaulted student loan will bring a whole host of trouble. Thankfully, most student loan lenders offer multiple repayment plans to help ease your burden.
If your credit is in good standing, and you’ve decided it’s time to purchase a new home in Fort Collins, contact the Re/Max office of Dennis Schick and let’s put your credit to some valuable use!
Recent Comments