How Does a Student Loan Affect Your Credit Score?

Due to the fact that 44.2 million Americans have already taken a student debt, they are now making sure that they are properly educated when it comes to student loans.

We will now discuss how a student loan will really affect your credit score.

By reading this article, you will be educated on how a student loan can contribute on your score and what techniques you should follow in order to maintain the best possible score that you can have.

Being Familiar with Credit Score

If you are curious on who calculates your credit scores and how it is calculated, just read this article further.

Most of the time, FICO issues credit score since they are the most popular company in their industry.

There are actually several factors that are considered before coming up with your credit score results, these includes the following:

Recent Credits

Credit History Length

Your Credit Mix

Payment Records

Amounts that Needs to be Payed

These elements corresponds to 10%, 15%, 10%, 35% and 30% of your credit score.

A credit score is made by using mathematical calculations. The exact calculations that FICO has come up with will not actually be transmitted.
Since there are several bureaus and companies that can provide you an information on how your credit is doing, you do not have to worry much about it.

Credit Karma is a website that will show you your credit score.

To see how well you performed, you can request a summary of your credit report once a year from credit bureaus such as TransUnion, Equifax and Experian.

Make Sure that a Good to Exceptional Credit Score is Maintained

In order to maintain a great credit score, you have to find out what would make it good, very good and exceptional.

Within the standards of FICO, they are defined as follows:

A score between 670 and 739 is a GOOD score
A score is considered VERY GOOD if it is between 740 and 799
If a score is between 800 and 850, it is already considered an EXCEPTIONAL score

At this point, you already know where the favorable scores are classified, what you should know next is how it can be maintained. This can be done by simply paying your credits.

This implies that all the credits that have, including your student loan, should be payed as soon as they are due and it should be payed in full.

You can be easily helped in renting an apartment, obtaining a home loan, buying a car and even get more school loans if your credit score is favorable. In cases like this and many more, those people who have a stand between you and your goals will definitely check the credit score that you have.