Do Student Loans Build Credit?

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Student loans help build credit, and it is important to maintain a positive record for paying off student loans to avoid hurting credit reports. Consider a deferment if financial difficulty keeps you from paying a student loan bill with advice from a financial adviser in this free video on student loans.

Part of the Video Series: Credit Cards & Personal Loans
Promoted By Zergnet


Video Transcript

Hi, this is Matt McKillen with Innovative Financial Group. The question posed to me today: Do student loans help build credit? Absolutely, student loans help build credit and affects your credit rating. During the time that you are in school and you have your student loans reporting, they're deferred because you're still in college. It usually isn't until you come out of school, you graduate, and you actually start your repayment part of the loan, that it really start impacting your scores. So if for any reason after you've gotten out of college, if you run into a financial difficulty or a lapse in jobs or something changes where you may have a difficulty in making your student loan payments, always contact your servicer of your student loan and look for either deferment or forbearance because if you do start running 30, 60 days late on your student loans, it can affect your total overall credit rating, which means if you go to get a car loan down the road or if you look to purchase a home, you may not have the required scores needed in order to get those types of credit facilities down the road. So treat your student loans just like any other type of loan -- car loan, what have you -- because they do report just the same as all these other type of institutions. Again, my name is Matt McKillen, and I'm with Innovative Financial Group.


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