I recently graduated college (this last May) and I have a full time job making ~54k/year. (I get a nice raise to ~65-70k this next May) and I don’t own any credit cards and my only debt is currently my $123k in student loans. When I applied for the apartment I’m renting, I had a credit score of 718, and since then I have paid off around $12k of my student loans during my 6 month grace period. Last month, I looked into another company that specializes in taking on large student loan amounts for lower interest rates to see if I could get something just a bit cheaper to pay it down faster. (My cumulative interest rate on the loans is currently ~6.2% and I wanted to see if I could get it to under 5.5%.) The loan company I looked into denied me after running a credit score check and quoted me as having a score of around 620.
Some other important info: The student loans are a bit weird. 93k of it is a Parent Plus loan that is technically not under my name(under my parents name), and that is what I’ve paid the 12k on as it has the highest interest rates. The other 30k is under my name. I still have 1 week left on my grace period, so I haven’t had a payment due and thus haven’t missed any.
I understand having a large amount of debt out hurts credit scores, but my debt has only gone down, since, and I’m consistently able to put almost 2/3rds of my pay towards the loans. Any idea what is causing it to drop? Is it the large payments that make me less favorable to profit off of? Or is it that “MY” debt hasn’t decreased? Or something else? I’m not too familiar with every little thing that goes into credit scores.
Atm, It isn’t a huge concern, as I don’t plan to buy a house until most if not all of that debt is gone, but with me not borrowing any sort of money, I’m afraid it will continue to tank and I’ll struggle to get a loan.
Submitted November 10, 2019 at 08:09PM by Schnieds1427 https://ift.tt/2rwC5Qh
