FAQ About Credit Scores And Student Loans

Most students would not have had much opportunity to build their credit history by the time they are ready to start college. This begs a few questions – will having no or little credit make it that much more difficult to get a student loan? If you do manage to get a loan with no credit history, will the loan affect your credit score? The following are the most frequently asked questions about the relationship between credit scores and student loans. 

A woman sitting on a couch holding a yellow credit card.

Q – Do I need to have a good credit score to get approved for a student loan?

When it comes to credit scores and student loans, federal student loans pay absolutely no attention to a student’s credit history. The federal government takes many factors into account when determining eligibility, but your credit history is not one of them. The federal government does not even consider your credit history while calculating the interest on the loan. All federal loan applicants pay the same rate of interest, regardless of their financial profile or credit scores. However, the same rule does not apply for private student loans.

Your credit history is the key factor that impacts your chances of an approved private loan. It also impacts whether you can get the offered interest rate or not. The better your credit score, the higher the chances of getting approved for a private student loan. Not to mention, the lower the rate of interest you will have to pay.  Without a credit history (or with a bad credit history), you will probably need a co-signer to get approved for a private student loan.

Sallie Mae logo.

3 Repayment Options

Variable rates from 1.87% - 11.97% APR with auto-debit

Learn More

Q – Which credit scores do lenders use to determine my eligibility for a loan?

The majority of private lenders use FICO credit scores to determine whether or not to approve loan applications, and at what interest rate.

Q – Which type of loan requires that you pay the interest accumulated during college?

You pay the interest accumulated during college on unsubsidized federal loans. These are low-cost student loans that the federal government offers both undergraduate and postgraduate students while they are still in school. When you take an unsubsidized federal loan, it is your responsibility to pay back the loaned money, as well as the interest that accrued on the loan during your time in college.

Q – How do student loans affect my credit score?

As a student, you may not have had the opportunity to build your credit score. But you can start now. Use your student loans to get off to a good start with your credit score. Make your monthly payments on time, every time, without any delayed or missed payments. That way, you will start to build a good credit history. A good credit score means easier approval for future loans and at a lower interest rate too.

Every time you miss a payment, you get a black mark against your credit score. That can then make it so much more difficult to get approved for any future loans.



Lender Rates (APR) Eligibility
Sallie Mae logo.
1.87% - 11.97% Variable
3.75% - 12.85% Fixed
Undergraduate and Graduate
Credibe company logo.
1.19% - 11.98% Variable
3.20% - 12.99% Fixed
Undergraduate and Graduate
Lendkey company logo.
Undergraduate and Graduate
Ascent company logo.
1.47% - 9.05% Variable
3.97% - 11.89% Fixed
Undergraduate and Graduate
College Ave company logo.
1.19% - 11.98% Variable
3.49% - 12.99% Fixed
Undergraduate and Graduate
2.93% - 5.67% Variable
4.35% - 7.15% Fixed
Undergraduate and Graduate
Earnest company logo.
0.99% - 11.44% Variable
2.94% - 12.78% Fixed
Undergraduate and Graduate
1.30% - 11.52% Variable
3.20% - 11.99% Fixed
Undergraduate and Graduate
College Raptor is not a loan lender and does not assume responsibility for suggesting a loan to a user who may not be eligible for it. Rates, terms, conditions, eligibility, approval, and other considerations are the decisions of the lenders and may vary depending on which lender or marketplace the user selects. We urge users to carefully consider and review all loan options and terms before committing to taking out a loan.

Leave a reply

Your email address will not be published.