Reply
New Member
kuttipuram8
Posts: 4
Registered: ‎08-12-2009

Deferred Loans on Credit Reports. Will it affect me?

I am currently a senior in college. I am trying to get a student loan in my name. Will all my deferred student loans affect my credit negatively or will it have a neutral or other type of effect?
New Member
bdonau
Posts: 3
Registered: ‎04-06-2007

Re: Deferred Loans on Credit Reports. Will it affect me?

The exact complex mathematical algorithms each of the 3 CRAs (Equifax, Experian, Trans Union) are using are secret, however ... 

 

We know that the credit score may be lowered due to several factor, among other:  "defaults" (not paying in time, paying less then agreed / debt settlement), too many (usually credit card) accounts with balances, and large total amount due.

 

1.  "Deferred" DOES NOT mean "default" !   It means that the financial institution agreed and allows you to postpone making payments.

2,  Student loan accounts ARE NOT credit (revolving) type accounts.

3.  By paying later some interest accumulates and is capitalized (added to the existing balance), thus increasing the total amount due.

 

Therefore, I have reasons to believe that only "3" may slightly lower your credit score. 


myFICO is the consumer division of FICO. Since its introduction 20 years ago, the FICO® Score has become a global standard for measuring credit risk in the banking, mortgage, credit card, auto and retail industries. 90 of the top 100 largest U.S. financial institutions use the FICO Score to make consumer credit decisions.

>> About myFICO
FICO Score - The Score that matters
Click to Verify - This site chose VeriSign SSL for secure e-commerce and confidential communications.
Fair Isaac Corporation is a BBB Accredited Financial Service in San Rafael, CA
FOLLOW US Social Media Facebook Twitter Pinterest Google+