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'Consolidate student loans to build up credit history'

Wednesday, 21 July 2010

Posted by Mozo

Students should look to manage their finances and consolidate loans in order to get a "nice boost" to their credit history upon leaving university, it has been suggested.

Evan Jacobs of StudentPlatinum.com notes that the challenge of building credit as a student "is like power washing a house with toothbrush – there are a lot of hurdles".

However, he argued that students should still think about improving their credit history while at university given that it can have a huge impact later in life, with graduates required to pass credit checks to secure properties, rent apartments or even gain a pricier cell phone contract.

"If you’re getting ready to graduate or already have, consider consolidating your loans early to get a nice boost to your credit score and history," advised Mr Jacobs. "When you perform a consolidation, you essentially are paying off all your current loans and opening up a new master loan. The credit bureau sees this as responsible finance and subsequently increases your score."

While the comments may encourage more people to compare student banking options and refinance, Mr Jacobs was also quick to point out that transaction accounts with monthly payments for things like utilities bills also report to the credit bureaus regularly, thereby offering an easy way to build up a credit history while paying for normal, routine things.

This article is brought to you by Mozo – Helping you compare student financesADNFCR-1761-ID-19901605-ADNFCR

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