Your Credit and Grad School
If the thought of checking your credit score for grad school is as daunting of a task as studying for the GMAT, then you’re in luck. Learn how good credit could be the answer to how you will pay for college and your credit could be a factor.
There is Government Assistance Available to Grad Students
With higher education costs up to $45,000 a year in the United States, most students choose to finance their graduate studies. According to www.studentaid.ed.gov, students can qualify for several types of federal aid including:
• Grants: Like scholarships, grants are monetary gifts that generally do not have to be repaid.
• Loans: Money you borrow for school, which you must repay with interest.
• Work-study: Income you earn specifically to pay for your education.
Additionally, the PLUS loan program, which is available to individual graduate students, reviews an applicant’s credit history before approving his or her request for a loan.
Your Credit History Might Pay Off After All
If you have a good relationship with your credit lenders, you could qualify for personal loans with better rates and conditions than other popular federal school loans. Some national banking institutions offer students competitive rates and can help supplement any costs not covered by scholarships, grants or federal aid.
A Low Score Can Impact Rates
If you think that your credit history might pose a challenge to being accepted into the right program, you could be right. While your academic performance might get you an acceptance letter into the school of your choice, a solid score will likely go into play if you plan to finance your way.
Check your report for any inaccurate items and work to correct the blunders. While financial aid and federal loans might assist with some of the costs of school, you may need to fall back on your credit to cover the rest. If your score isn’t in top shape, you could miss out on financing or it may require you pay higher interest rates that would make paying back the loans tough.
School Loans Can Have a Positive Influence on Your Score
Student loans, federal or private, are considered installment loans and can help bump up your score if you make your payments on time. However, if you miss payments, it will negatively impact your credit.
If you think you’re at risk for missing a payment, contact your lender sooner rather than later. Some lenders can offer income-based repayment options to avoid default or interest rate hikes. If an account is listed as deferred, this could hit your credit report hard and lower a grad student’s chance for future lending.
Be sure to keep your credit in check before grad school so you might be well on your way back to the classroom (whether in person or online).