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Building a credit score for a college student

Anonymous
Not applicable

Building a credit score for a college student

We recently purchased a car for our college student and insteading of buying out right we took out a loan with her in an effort to build her credit.  We are about 8 months into the loan and I'd like to just pay it off but wanted to know if we should wait to do so to build her score?  

 

She has been an authorized user on our credit card for about 4 years.  Is there anything else we can/should be doing to help her build her credit profile?  

Message 1 of 7
6 REPLIES 6
FireMedic1
Community Leader
Mega Contributor

Re: Building a credit score for a college student

Dont pay the loan off. Its helping for now build some history. Time to get some revolving accounts on their own. Maybe with your bank or Discover has Student Cards. Cap One also has student cards with a pre-qual no HP check:

https://www.capitalone.com/credit-cards/preapprove/student/?external_id=WWW_LPT66_ZZZ_ONL-SE_ZZZZZ_T... 



Homeowner Sept 2020. 2021 Explorer ST Chase 3.1%. Sharing my recovery after BK from learning here. Started 540's. EX FICO 9 801 as of 05/03/2023. I stayed around to pay it forward for those who helped me back then.
Message 2 of 7
SouthJamaica
Mega Contributor

Re: Building a credit score for a college student


@Anonymous wrote:

We recently purchased a car for our college student and insteading of buying out right we took out a loan with her in an effort to build her credit.  We are about 8 months into the loan and I'd like to just pay it off but wanted to know if we should wait to do so to build her score?  

 

She has been an authorized user on our credit card for about 4 years.  Is there anything else we can/should be doing to help her build her credit profile?  


It's ok to pay it off. The payoff might ding her score a little but it's more important to have a clean title.

 

The next step is for her to get her own card.  If she has a good credit score, she could get an unsecured card. She might want to join a good credit union.

 

 

 

 


Total revolving limits 748700 (628200 reporting) FICO 8: EQ 701 TU 717 EX 682

Message 3 of 7
Kforce
Valued Contributor

Re: Building a credit score for a college student


@SouthJamaica wrote:

@Anonymous wrote:

We recently purchased a car for our college student and insteading of buying out right we took out a loan with her in an effort to build her credit.  We are about 8 months into the loan and I'd like to just pay it off but wanted to know if we should wait to do so to build her score?  

 

She has been an authorized user on our credit card for about 4 years.  Is there anything else we can/should be doing to help her build her credit profile?  


It's ok to pay it off. The payoff might ding her score a little but it's more important to have a clean title.

 

The next step is for her to get her own card.  If she has a good credit score, she could get an unsecured card. She might want to join a good credit union.


^^^ This

Message 4 of 7
FireMedic1
Community Leader
Mega Contributor

Re: Building a credit score for a college student

Question @SouthJamaica and @Kforce . It appears the loan was cosigned. Why close it after 8 months? Whats wrong with getting some more payment history under the belt as we can see it could be paid off at any time.



Homeowner Sept 2020. 2021 Explorer ST Chase 3.1%. Sharing my recovery after BK from learning here. Started 540's. EX FICO 9 801 as of 05/03/2023. I stayed around to pay it forward for those who helped me back then.
Message 5 of 7
Anonymous
Not applicable

Re: Building a credit score for a college student

I'd like to pay it off and stop paying interest for something that we could easily purchase outright.  

Message 6 of 7
Anonymous
Not applicable

Re: Building a credit score for a college student

Thanks, we will look into this weekend.  

Message 7 of 7
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