If you have defaulted on a student loan and are seeking student loan assistance, you are at the right place. A loan default can have a severe impact on the credit score. And chances are you might feel the need to borrow money again. But with a poor credit score, it can technically be impossible to avail of a loan again. Even if you are able to avail a loan, there are high chances that the loan will be given at a high-interest rate. But don't lose hope! All is still not over! With the right guidance and student loan repayment assistance, you can repair the damaged credit.
Good or bad, your credit score is an important factor in many aspects of your life. From securing a loan to applying for a cell phone plan, a credit score is a number that lenders and service providers use to determine your ability to pay. Your credit score is based on your credit history, which is the collection of accounts and loans you've taken out and payments you've made on those accounts. A lender pulls your credit report to determine your credit score when you apply for credit.
Tips for Credit Repair and Federal Student Loan Consolidation
Work on the Loan Default
First things first! In order to improve your credit score, you must undo the loan defaults as soon as possible. You can follow the below-listed practices to start off immediately:
Pay off your existing, outstanding & defaulted loans as soon as possible.
Rehabilitate your loans. Plan a series of affordable monthly payments with a loan collection agency or a loan service provider.
Consolidate your federal student loans. If you have multiple outstanding student loans, it is best If you consolidate all of them into one. This will enable you to count as one payment and will probably bring you out of Default and improve your credit score.
Pay off Other Debts
It is a well-known fact that credit utilization like outstanding credit card payments, bank overdrafts, etc., accounts for 30% of your credit. If you think you are unable to manage your outstanding debts, it is best if you start taking care of them at the earliest. Credit card payments, local vendor purchases, etc., may seem insignificant but can have a huge impact on the credit score. It is important to make these payments on time! Student loan repayment assistance can help you pay off debts and improve your credit score.
Apply for a Credit-Building Loan
Credit-building loans are effective methods that can help borrowers build their credit. Unlike other loans, in the case of a credit-building loan, you do not receive a lump sum amount of money; the amount you borrow is held in an account that you can’t access until you’ve paid off the loan. These loans can be more easily accessed than traditional loans if you have bad credit. Over time, the lender will report to the three credit bureaus that you’ve been repaying your loan, eventually increasing your credit score. Get student loan repayment assistance to apply for a credit-building loan TODAY!
Final Word
Defaulting on a student loan may bite you, but it may not bite as hard if you have solid student loan assistance in order. A bad loan may have a hefty impact on your credit score, but at the same time, a good student loan repayment assistance can help you improve your credit. There are several benefits of having good decent credit; you can avail better credit card deals, get a lesser interest rate on future loans, tap additional benefits offered by credit agencies, and so much more.
If you look to improve your credit score, nobody does it better than Buena Credito! Buena Credito is a leading student loan assistance provider that helps thousands of students improve their credit scores every year. The credit repair agency uses the latest and most effective techniques to help you improve your credit.
Know more about Student Loan Assistance and Buena Credito!
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