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Student Loans and your Credit Score

Student Loans and your Credit Score

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Student loans do not necessarily negatively or positively affect credit ratings. However, whether or not the student responsibly handles paying off the loans is what ultimately influences credit. Below are two things you can do to keep student loans from harming your credit score.

1.Making payments on time

This is most important thing to do for your credit if you have student loans. If you do this, it will show banks and other lenders that you are a responsible borrower and that you know how to budget correctly for a loan. This can increase your likelihood of being approved for a home loan or a car loan.

2.Default vs. deferment

Continually failing to make payments will put your student loan into default, which means you did not fulfill the conditions of the loan. This is very serious and will have a negative influence on your credit. Deferment does not negatively affect your credit. It is a way of professionally communicating with your lender.

If you have questions regarding your credit score and how taxes and loans may negatively affect your standing. Please call today at (800) 261-6671 for more information.

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