The Most Important Credit Move Before College?

What is the most important thing to do before you go to college?

I had a friend going into their second term at Kettering University and they needed to apply for a student loan.  The loan that they were applying for consider credit scores.  Many times young adults who are in their first year of college have not built up a sufficient credit history for a good credit score.  College loans are based on the credit history of the student not the parents.

The most important thing students should do before they go to college is to build a great credit history.  With one or two credit cards they can start off on the right foot hopefully they have one or two bank credit cards.  Store credit card are better than nothing just make sure to maintain three  to seven percent balance on the credit cards on the reporting date the month prior to you applying for a loan.

If the student loan company is going to pull your credit report in January you want to make sure that at the end of December you have three to seven percent balances reporting in order to boost your credit score as high as it can be when you apply for that student loan. Zero is not as good as 3 to 7 percent really 5 to 9% is what I have been saying in the past.  3 to 7 is a more cautious, especially if you only have a few credit cards in their small balance’s you really want to be at the lower end. That’s why I’m saying now three to seven percent rather than five to nine.

The other thing to consider is if your parents have a credit card that they’ve had for a long time and never had a late payment, you may want to ask them to add you as a joint card holder or an authorized user. I would prefer that you go to a joint card holder status.  You don’t have to ask for a card from your parents or grandparents. You can just be listed on that account then wait about three months before you apply for the loan.  The reporting may be just one month but it may take longer so three months should be safe.

Three months before you apply for the loan, if you can get recorded on a parent or grandparent’s credit card that has;

long credit history

low balance

never late

Then when you apply for these new student loans you will get the best possible rate. Student loans can be fixed rate loans. If Students have not built up a good credit history they’re going to be penalized because they  don’t have that great credit history established. If you want more information go to my free six steps to a better score at GetLoanReady.com is all free to follow the six steps in your credit score as high as possible will be better every month moving forward.

For ideas to get your student loans forgiven click here 

If you want to see more videos about credit and credit scoring check these out at www.thecreditguy.tv. If  you are a mortgage lender please share this on your Facebook or LinkedIn page.   If you have any questions, leave them down below I’d be happy to answer them.

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Go to www.getloanready.com to find other ways to improve your credit score. I’m Dave Sullivan here for the credit guy TV so you with a little bit me we’re going to change the credit industry thank you

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