Why Is Your "Credit Score" Important?
Credit Issues
Families may be seeing reports in the media which speculate about the impact of the subprime mortgage credit crisis on the availability of students loans. Please review the information in this section for more information.
Lenders normally look at your past history in repaying consumer debt in determining the interest rate that they will charge on a private student loan. Major lenders often utilize your "FICO" score.
Credit bureau scores are often called “FICO scores” because most credit bureau scores used in the U.S. are produced from software developed by Fair Isaac and Company. FICO scores are provided to lenders by the major credit reporting agencies.
FICO scores provide the best guide to future risk based solely on credit report data. The higher the credit score, the lower the risk.
- What's My Score? (and why it matters)
- Understanding your FICO score
- Suggestions for improving your score if you have had credit problems in the past
- You are entitled to a free copy of your credit report from each of the three major credit reporting agencies once a year. You can obtain these free credit reports from www.annualcreditreport.com. Call 1-877-FACT-ACT (1-877-322-8228) for more information
Most lenders will offer a lower interest rate to students who have a "credit-worthy" individual willing to co-sign their loan application. An individual who co-signs your loan application will be held legally responsible if you fail to repay your student loan.
Credit Card Act of 2009
Most provisions in the Credit CARD Act of 2009 are effective February 22, 2010. The reform legislation, signed by President Obama in May 2009, place new restrictions on credit card fees and interest rate policies. Read More about these changes
Updated March 1, 2010