Student Loans--How they affect credit

[jenn_bar]

Thanks for all the help throughout Fico! You guys are awesome!

I will be in my second year of law school in the fall and have taken out currently $12k of loans. By the end I will have $55k in loans (yikes!). I am curious to know if and when the loan comes up for repayment, will my credit score drop even if I pay on time every month, etc?

Thinking about apping for one more credit card now so I'll have zero inquiries in two years when that occurs. Also, I was hoping to app for the AMEX HH and it looks like AMEX has denied those that have a significant amount of student loans (seen via the credit card forum). I just didn't know if this was because of poor payment, or the loan in general.

Any advice would be appreciated!

[SCF]

Moving from deferment to active repayment doesn't really change how a loan is considered for your credit score.  In either case, it is still a loan in good standing, and as long as you don't miss a payment, it will be a positive account.  Over time, it will have a larger benefit as it ages and increases your AAoA.

I would imagine (but am not sure) that the situations with Amex are due to debt-to-income ratio issues.  If you have a low income and high debt, prime lenders like Amex are going to extend you smaller credit lines, if they extend credit at all.  Apping now might get you a card, but if you don't use it, or if Amex is scared off by your increasing debt, they could close it in the future.