Deferring student loans hurts credit score and rating?
No. Deferring student loans does not hurt your credit in one way or the other. At least it should not, as long as such deferment is properly reported. Deferment is an agreement between you and creditor, like Sallie Mae which you must qualify for first. Deferring student loan payments means that you have a valid reason for this to happen, and will be paying them in a future. It is not a refusal to pay and in any way is considered as derogatory. With that said, if you are deferring student loans, always check your credit report and score after 8 weeks you enter into agreement to verify it is properly reported. I saw on two occasions, albeit a long time ago, when billing department was reporting deferred student loan payments as late while another branch was going through the motions. In both cases, the guilty party was Citibank and it promptly fixed the mess after complains. It did hurt credit score rating rather bad initially.
One other thing to understand that while deferring student loan doesn't hurt credit score, the deferred payment is almost always counted towards your debt to income ratio when applying for a mortgage, car loan, etc. Keep the paperwork showing the terms of your deferment, so potential lender can clearly see your would be payment.
More on student loans
defaulted student loans, wage garnishment
delinquent student loans - consolidated student loan and previous delinquency
student loan rehabilitation program
student loan dispute
Tue Sep 22, 2009 10:09AM | Copyright: www.bad-credit-advisor.com | More in Student Loans | Comments (0)
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