 TITLE: Do Student Loans Help Build Credit? CONTENT: Student Loans Could Also Negatively Impact Credit\n-------------------------------------------------\nAlthough you'll have more debt, taking out student loans usually won't have an immediately large positive or negative impact on your credit scores. However, during repayment, missing just one payment could hurt your scores.\nThe impact of late payments may also be amplified because many borrowers take out more than one student loan to pay for school. During repayment, they make one monthly payment to their student loan service, which then distributes the money to repay the individual loans. As a result, missing one payment to your servicer could lead to multiple late payments getting added to your credit reports.\nIf you miss multiple payments in a row and are 270 days late on federal student loans, your loans will go into default. Private student loans can default sooner. The default will get reported to the credit bureaus, which will further hurt your scores and can lead to additional consequences. You may have to pay extra fees, and the government can take funds directly from your paycheck or tax return to repay your past-due amount. Fortunately, there are ways to get your federal loans out of default, and even have the default removed from your credit history.\nAlso, although it's not part of your credit scores, the debt from your student loans could increase your debt-to-income (DTI) ratio. Creditors may consider this when you apply for a new loan, and having a higher DTI can make it more difficult to get approved with the best rates and terms. END