How to Manage Your College Loans to Keep Your Credit Score Intact

How to Manage Your College Loans to Keep Your Credit Score Intact Photo by Images_of_Money on flickr.com Repay The Interest â€" If you have a bank loan, begin to repay the interest when you are in school so that by the time you graduate and if you have to defer the loan, the amount will not add up to too much. Consider the amount of interest and add it to your monthly budget. Utilize Grace Period â€" After graduation, the lender/the bank will give you a grace period of approximately 12 months within which you have to start your repayment of the student loan. Use this period to find employment that will not only provide you financial stability but also help you to begin with the repayment of the loan. Holding on to regular employment when you are repaying the loan will positively impact the credit report and score. When applying for a job, be sure to check your credit report before your employer does! Remember that a good credit report suggests that you are a reliable person, which increases your chances for selection. Pay More Than The Minimum Amount â€" It is essential to pay more than the minimum amount so as to repay you loan as early as possible. Use all the extra cash that you have to repay the loan. The decreasing amount of the loan will increase your credit score steadily. Do Not Default On The Loan â€" Since student loans are installment loans, they are very good for improving your credit score if you make the payments without skipping. Therefore, try your hardest not to skip payments and be reported as delinquent. Student loans like other loans are helpful when you are seeking to improve your credit score. But you must ensure that you are making the payments faithfully without missing a single installment. Apart from helping your to improve your score, this will also help you at the time when you wish to re-finance with a lower rate of interest. By  Brenda Lyttle