Student Aid - Will taking more federal aid hurt my credit score?

[Anonymous]

Hi - I'm 22 with pretty awful credit from forbearing my student loans a couple years ago. TU 546 EQ 555. Both up about 60 points since July 2015 and very slowly creeping up.

My loans (about $13,000 in federal direct unsubsidized loans) have ben current and paid on time since then, and I have no other debts or collections. I'm planning on gong back to school this fall part-time but am worried about taking more federal aid - is this going to trash my credit score? I don't think I can hadle another hit like that.

I'm financially stable otherwise, but I could not afford an edcation out of pocket.

Thanks

[RobertEG]

Is the implication that you believe you cannot handle more debt, and thus are likely to become in default?

[Anonymous]

No, I have the income to handle additional debt from taking more loans - I'm worried that receiving another federal loan will drop my score even if I have no trouble keeping it current

[RobertEG]

The Higher Education Act, due to the many peculiarities of federally insured or guaranteed student loans, such as exemptions from SOL and extended credit report exclusion provisions, mandates their reporting to the CRAs, so there may be some impact, such as lowered AAoA.

However, intallment debt balance itself does not have a substantial scoring impact.  It is not part of your percent util of revolving credit.

I would assume any credit scoring implications would pale in comparison to the benefit of the attainable education.

[Anonymous]

Thank you! This has put my mind at ease a little.