 TITLE: How Does Student Loan Debt Affect Buying a Home? CONTENT: Student Loan Impact on Credit Scores\n------------------------------------\nYour credit score is a number that lenders use to assess your financial history and determine how creditworthy you are. It's based on several factors, including how much debt you have, what kind of debt you have and whether you pay your debts on time. (If you're not sure what your credit score is, get your free score from Experian to find out.) Most people have many credit scores, with variations depending on the model used. Lenders choose which to use when making their decisions, and typically use a FICO® Score☉ when evaluating mortgage applications.\nLike all types of debt, student loan debt can affect your credit scores either positively or negatively. Missing a student loan payment or making a late payment will have a negative impact on your scores. Late payments remain on your credit report for seven years.\nMaking student loan payments on time every month, on the other hand, can help improve your credit scores. Setting up auto payments for your student loans can help to ensure you never miss a payment, giving you peace of mind while also potentially boosting your credit.\nKeeping your credit utilization ratio low is another way to improve your credit scores. Your credit utilization ratio reflects how much of your available credit you're actually using. If you have a total credit limit of $9,000 on three credit cards and carry a balance of $750 on each (or $2,250 total), your credit utilization rate is 25%. A low credit utilization rate shows you're doing a good job of managing your debt. In general, it's recommended to keep your credit utilization rate under 30%—the lower, the better. END