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shunice85
Posts: 1
Registered: ‎09-19-2008

Paying off my school loans while still in college

I was told that in order for my credit score to rise I would have to start paying on my school loans. I figure, why pay on them now when I have years to go before I have to start paying them back. My school loans are the only credit I have and it is greater than the credit I have now on my one credit card. Should I start paying off my loans to boost my credit score? Is this a good idea? I really need to boost my credit score. It is really POOR!
Moderator Emeritus
Timothy
Posts: 9,252
Registered: ‎03-19-2007

Re: Paying off my school loans while still in college

Keep Utlization down on yout card- and pay everything on time-
 
This is more important score wise than paying your SL-
 
When you are ready- getting your SL's off 100% utilization is worth 10 to 15 points.
Established Contributor
jesslyn
Posts: 945
Registered: ‎06-13-2008

Re: Paying off my school loans while still in college

The only thing that paying your student loans now will do will bring your util down.  Since no payment is due at this time (in school deferment), it will not count in your favor as on time payments.
 
On time payments for other credit products is what will help you the most.
Established Contributor
rmily
Posts: 670
Registered: ‎07-12-2008

Re: Paying off my school loans while still in college

I was encouraged to pay accrued interest on my unsubsidized stafford loans while I was in school and something really cool happened. I'd make a payment for the current accrued interest and they'd apply it toward the principal as a refund and then the interest on that amount no longer applied. Hard to explain but I don't think it affected my credit scores since it only reset the original disbursed amount. Financially healthy, though. Toward the end I stopped doing this since I was nearing the 20k mark which allowed me 20 years instead of 10 to pay off the loans. This was like 7ish years ago so I'm not really in the loop of how things currently work or even if that was standard practice but might be something to chew on..

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