Student Loans, Credit Scores and Home buying
This month lets talk about how student loan debt, credit scores, and home buying all go hand in hand. Are you currently a student looking to purchase a new home, but having issues taking the next steps because of student loan debt or low credit scores?
I have put together some tips that you may find useful in helping you pursue your dream home although your credit scores are low or you have a stack piled up in student loan debt! Never fear, where there is a will, there is a way!
First, lets tackle the big one… STUDENT LOAN DEBT. I’m currently a student so those words make me cringe! I’ve found these tips on how to lower your student loan debt while still in school to be beyond helpful. I found that if you pay on your debt while still a student, you can acquire lower interest rates! Now, the reality of it is this; You are a student, you don’t have access to tons of extra funds, (If you did, you would probably not have any debt at all…Right?) So, the need to budget is imperative. I’m a student myself and I once believed the myth that running to McDonald’s is easier and cheaper than making a home-cooked meal…WRONG! Home cooked meals will last longer than one burger and a large fry at McDonald’s! If you used the money you spend on fast food for the entire month as loan payment money, you would be saving so much and (in turn be a lot healthier:)
Budgeting is key when tackling that student loan debt early on to keep from having such high interest rates! Also, when you do not pay on the balance at all, the interest will only compound, so pay SOMETHING every month.
Credit scores are so awesome to see when they are good, and will make you not look at them at all when they are bad. You should be checking your scores every two weeks even though they are updated weekly. Paying bills on time, rent every month, or that new car payment could all be positive ways that you affect your credit. When you have debt, it’s a good idea to counter act it with financing something whether its a car, a new phone, or TV. Make those payments on time, and watch your credit score rise! Credit Karma is a great app to check your credit on regularly to avoid having to go open it in a browser every time. “Your credit score is as valuable as your life. Once its messed up, it may take an entire life time to rebuild.” Those words are from my daddy. He has always stressed how important keeping your credit score up is, and what it could mean when you go to purchase a home. With a good credit score, it can help keep your interest rates low because you are a first time home buyer.
Protect your credit! Pay on that student loan debt every month, $100 a month may not seem like much, but it adds up and could be the reason your debt to income ratio won’t keep you from buying that first home after graduation! Take the steps to do what is necessary early so that when the time comes, you have nothing in the way of you and that new home!