Hello, my name is Jessica, I am 25 now and will be finishing school now…
Couple questions about student loans and credit.
So, do they affect the credit score?
I don’t have any job right now, and I am constantly looking, how much time will I have to start paying them off?
I will have around $40,000 total of debt and just want to see how it will affect my credit because I plan on buying a home in the next 3 years.
Do student loans will hurt my credit?
Will I need to hire a a credit repair company so I have a score of 700 at least?
Lets say I find a job at 80k, how much should I pay them off?
Not sure what the interest is.
Anyway, thanks! and I hope I am in the right category!
so from my experience, age 30 credit score of 820. a little debt is good as it build credits. excessive debt will hurt your credit. 40k imo is excessive. depending on the apr, you should pay more to get rid of it so find out. if the after tax rate is 5%, focus on paying it off.
you dont need to her a credit repair company. there are lots of sites that will tell you how to fix it. here’s 1: https://www.nerdwallet.com/blog/finance/raise-credit-score-fast/
student loan debt is actually considered good debt along with car and mortgage. you want to pay off credit cards first. and when it’s paid off continue using it and paying it in full. i have about 5 credit cards, 1 is for travel. 1 is for everyday use (highest points). 1 is for amazon. 1 is my old one that has less points now.
also when buying a home, you will need a downpayment. even with an fha loan with closing fees, you’ll prolly need and want 5 to 10% of purchase price in hand. home prices are expensive right now as well. now is the time to clean up your credit score an wait for opportune moments. gl
Don’t think about buying a house now. Get a job, pay your loans, and invest anything remaining. When you are in a stable situation (you won’t move for 5-10 years) and have a secure financial position, then think about buying something like a house.
Vote for Bernie Sanders or Elizabeth Warren. They’ll forgive all student debt.
are you Serious? or Kidding Me…?
Student loans are considered an installment loan. An installment loan generally has a starting balance that’s repaid over time with a fixed number of payments. Home mortgages typically fall in this category, too.
FICO, which issues the most popular credit score, treats installment loans differently than revolving debt like credit cards. With revolving credit, balances tend to go up and down over time. Borrowers access this credit whenever they need it. In the case of credit cards, that can mean any time you make a purchase.
All installment loans and working capital loan are treated the same way when calculating your FICO credit score. Student loans don’t have their own category or receive any special consideration. It also doesn’t matter if your student loans are federal or private. Both are treated the same.
Direct responses below with a longer reply that you may find helpful.
You generally have up to 3-years to find a job before they starting sending you bills. You HAVE to apply for this, it’s called deferment.
They certainly do not help your credit.
No, why would you have to hire someone?
I think you mean how long will it take to pay off? Clearly you need to login into whatever institution originated the loan to you and do some serious homework. Your interest rate is probably at 6% given the historical averages. At that rate, assuming a 5-year loan, you’re looking at ~$770 a month for 5 years. If you make 80k, live on your own, have normal bills in NYC area, you literally can’t afford to pay this off any quicker.
For example, if you wanted to pay the loan off in two years, you would have to make a payment of 1,700 a month each month for 2 years straight. Not really realistic.
Your credit score is the least of your concerns at the moment. You should research how to defer your student loan payment until you can get the job you want. Get a job, then you should figure out how much you can afford to contribute to paying down the debt on a monthly basis to see how long it will take to pay off. Then, and only then, should you even start thinking about buying a house.
You are 6 years away from buying a home. Sorry if this is blunt but you have to be realistic.
Op is bot doing campaing for that company linked
If Nery has an 800 credit score, then something must be wrong with the system and we should sell all financial stocks.
i just understand leverage more than you is all!