The Most Useful Credit Repair Tips Every College Student Needs

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One of my biggest long-term financial goals for the past 2 years was to build my credit for a new car, so I wanted to share my credit repair tips with many of my student readers. After graduating college, students entering the next phase of adulthood are likely planning to make big purchases such as new cars or homes. However, with student loan debt under one's belt, don't these tasks become harder? - www.theballeronabudget.com

One of my biggest long-term financial goals for the past 2 years was to build my credit for a new car, so I wanted to share my credit repair tips with my student readers as this may be a common goal for many. After graduating college, students entering the next phase of adulthood are likely planning to make big purchases such as new cars or homes. However, with student loan debt under one’s belt, don’t these tasks become harder?

Any large purchase that typically involves financing requires the buyer to qualify with a minimum FICO score. Your FICO score – calculated by Fair Isaac Corporation – is calculated using a scoring system that analyzes your credit information across Equifax, Experian, and TransUnion to calculate your lending risk. Generally speaking, the lower your score, the lower your odds are of qualifying for that mortgage loan or car loan and get out from under Mom and Dad’s wings.

While student loans are generally considered “installment loans” and are not typically analyzed like revolving credit (ie. credit cards) by FICO, student loans still have the potential to ruin your credit before you ever get the chance to establish your credit history.

Think about it: many college students and graduates may be juggling a number of monthly bills with a limited income: phone bills, rent, car payments, as well as basic necessities like food and gas must somehow be accounted for. With things like credit card payments and student loans, how is it even possible to stretch that budget to cover everything? It seems inevitable that anyone could eventually miss a credit card or loan payment, leading to a plummeting credit score.

So what does that mean for graduates fresh out of college with enormous student loans and credit cards to pay off? What are your options?

Employ Strict Savings Strategies

This might take some time to master, but simple lifestyle changes such as less trips to Starbucks, more cooking at home, buying used items instead of new and sharing an apartment with other students can help you save money in different areas. Although savings does not make a direct impact on your credit score, having more liquid cash can prevent using credit cards as your main payment method.

If you're already great at budgeting, then you're one step ahead of those struggling to wean themselves off credit cards. No matter what the case, you should minimize credit card spending and refrain from opening up any other lines of credit. Last year, my New Year's resolution was to not touch a single credit card for the entire year, which allowed me to pay off 2 credit cards and raise my credit score by a few points. - www.theballeronabudget.com

Always Monitor Your Credit

Stay vigilant with your credit monitoring and you can prevent any incorrect marks against your credit, such as incorrect late payments. Last year, upon checking my credit I saw there was a missing payment from 3 months ago but I’d paid it on time, so I called the creditor and disputed it. It was removed from my credit report, and all was back to normal.

Acts such as The Fair Credit Reporting Act (FCRA) give you the right to dispute such inaccurate items with the credit bureaus and individual creditors. If you feel this may be a challenge, Lexington Law Firm can also help you fix such credit errors: they have long-standing relationships with all three credit bureaus, and these relationships allow them correct credit errors efficiently all while teaching you how to build your credit.

Pay Your Bills on Time

Whether it’s your monthly rent, credit cards, or student loans, it’s extremely important to make a payment each month. According to Student Loan Hero, late payments on student loans can impact 35% of your credit score! They can also stay on your report for up to seven years, which can jeopardize your chances of qualifying for other loans in the future.

On the plus side, since student loan payments are reported to your credit bureaus, paying on time can actually help your credit score.

If you struggle with making payments, try using Dave Ramsey’s debt snowball method: each month, pay only the minimum on all your credit cards except for the one with the lowest balance. If you make bigger payments on this particular debt, you can get rid of it faster and then repeat it with your other debts until they’re all paid off. I used this exact strategy to pay off 2 credit cards fairly quickly last year!

Staying vigilant with your credit monitoring and you can prevent any incorrect marks against your credit, such as incorrect late payments. Last year, upon checking my credit I saw there was a missing payment from 3 months ago but I'd paid it on time, so I called the creditor and disputed it. It was removed from my credit report, and all was back to normal. Acts such as The Fair Credit Reporting Act (FCRA) give you the right to dispute such inaccurate items with the credit bureaus and individual creditors. If you feel this may be a challenge, Lexington Law can also help you fix such credit errors. - www.theballeronabudget.com

Avoid Credit Card Usage

If you’re already great at budgeting, then you’re one step ahead of those struggling to wean themselves off credit cards. No matter what the case, you should minimize credit card spending and refrain from opening up any other lines of credit. Last year, my New Year’s resolution was to not touch a single credit card for the entire year, which allowed me to pay off 2 credit cards and raise my credit score by a few points.

Don’t Be Afraid to Seek Out Credit Repair

When people think about financial advice, it’s often believed to be an expensive service. However, the credit repair industry has grown tremendously in recent years, which means credit repair is now much more affordable, especially with Lexington Law Firm. Packages start at just $24.95 per month, making credit repair affordable for many college students.

What are your credit building and credit repair goals? Do you have any stories to share? Let’s chat in the comments below! Don’t forget to subscribe to my newsletter and follow me on Instagram for more money-saving tips and tricks.

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Did you know that your student loans have the potential to ruin your credit score before you get to establish your credit history? A poor credit score can prevent you from making large purchases such as homes or cars. So before you try to get your dream car, here are a few ways you can build and repair your credit. #ad - www.theballeronabudget.com

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This post is sponsored by Lexington Law Firm, a high service partner and consumer advocate that will help you fight for the credit you deserve. Although sponsored, all opinions are my own.

1 Comment

  1. SHELLY PRICEY
    March 9, 2019 / 5:57 pm

    I usually pay cash for stuff I buy.however i have quite a bit of debt due to my low income , how is that viewed when applying for a credit card. My credit score is constantly on a roller coaster and now severely suffering because my cousin has not been paying her monthly note as expected and myself has been skipping few bills.I applied for an American Express card ,the application was denied.Though i had one many years ago and i use it to pay my minor expenses on time. This is the second time that I got denied.i have been monitoring my score and now i have My credit score at about 610 and 550 respectively but i needed it to be upgraded for a CAR loan, just last week i saw a review on Facebook about this financial solution expert who helped a lady to boost her credit score and clear all errors on her profile.I took his contact and mailed him asking him if he can help me fix my credit,Expectantly it was fixed after three weeks and raised to 795 and 800 all my late payments and inquires has been rolled out..HACK WIZ at PROTON MAIL DOT COM,Thats his email, should in case you choose to clean your credit faster just like mine.

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