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Be aware!!!!

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CreditBob
Established Contributor

Be aware!!!!

Even though student loans are deferred or in other words have delayed payments, you are still in debt. And creditors will look at what the original balance is and compare it to what you now owe. It is in your best interest to pay done the loan as soon as you can. If you have a high balance then your debt to income ratio is too high. Mom & dad that gives you money may most likely not count. You have to have documented income such as a paycheck stub or tax returns if your are self employed. On the fico score the balance is considered high until you have paid down 35% of the original student loan balance.
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Anonymous
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Re: Be aware!!!!


@CreditBob wrote:
If you have a high balance then your debt to income ratio is too high. Mom & dad that gives you money may most likely not count. You have to have documented income such as a paycheck stub or tax returns if your are self employed. On the fico score the balance is considered high until you have paid down 35% of the original student loan balance.

Debt to income ratio is based on the monthly payment and your income. High balance is only part of the equation. Other key parts are the length of the loan and your income and the interest rate.

 

Could you provide the source for your last statement? I'd be interested in seeing more about that. I started tracking my scores when I had about 6% of my original balance paid down and they've been 740s+ and Scorewatch has yet to mention high utilization as a negative. To this date I've paid down 8% and my only negative is short credit history..

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