What effect does student loans have on credit

[TheTruth]

Right Now I'm currently still in college and I'm wondering what effect my student loans will have on my credit score? I have 5500 in student loans ,so far ,but it shows up on my credit report as Installment debt (fixed payment loans) my question is what type of effect can this have on my credit score ?

[krzywon]

While you're in school, you gain the benefit of an aging, active, 100% positive account on your credit report. It helps you a great deal. The balance doesn't have any major effect.

 

Once you've graduated, if you pay 100% on-time, student loans help your credit score/history a lot.

[TheTruth]

While you're in school, you gain the benefit of an aging, active, 100% positive account on your credit report. It helps you a great deal. The balance doesn't have any major effect.

 

Once you've graduated, if you pay 100% on-time, student loans help your credit score/history a lot.

 

 

 

Ok ,so basically what you're saying is student loans don't have a negative affect on credit ? while in school ?

 

I take you're also saying as long as when I leave school if paid on time it will actually benefit me ?

[krzywon]

While you're in school, you gain the benefit of an aging, active, 100% positive account on your credit report. It helps you a great deal. The balance doesn't have any major effect.

 

Once you've graduated, if you pay 100% on-time, student loans help your credit score/history a lot.

 

 

 

Ok ,so basically what you're saying is student loans don't have a negative affect on credit ? while in school ?

 

I take you're also saying as long as when I leave school if paid on time it will actually benefit me ?

I have significant SL balances that I'm paying on right now. They are my oldest accounts and I have never been late. I have NEVER been denied credit and the interest rates I've received have always been competitive. As long as they are paid as agreed, they can only help your FICO and credit history.

 

How they can hurt you, even while paid as agreed: your debt-to-income (DTI) increases. A DTI of 40% or more will limit your ability to get other loans. By entering the longest payment terms available, you can effectively lower you DTI. You can always pay more towards the principal each month, but your DTI goes by the minimum payment.

[Jon77]

^^^That's what I did to qualify for my house recently. I refinanced it so that my payment went down a few hundred a month. Definately helped.

[BossHog]

I'm currently in med school. Have well over $120K in student loans.

 

-I declared BK7 in 2006. My scores have been increasing since then.

-started med school in 2007. scores still increasing.

-Student loans disbursements of over $15K every 6 months not affecting my scores. I don't take a hit when the new loan appears on my CR.