Federal student loans –whether they’re subsidized or unsubsidized –do not require a good credit score when you take them out.
Since these loans are usually taken out by young students, you don’t even need a credit history to qualify for the money you need.
Lenders and creditors won’t trust that you can pay back your debts.
You either won’t get approved for loans and lines of credit or you’ll face really high interest rates and harsh terms.
Therefore, even for a standard 4-year bachelor’s degree you could easily have as many as 8 separate accounts showing up on your credit reports if you consistently relied on student loans to finance your education.
To some degree, yes, having multiple student loans appearing on your credit reports may cause a small amount of credit score damage.
They’re separate animals, so to speak, and you just shouldn’t try to combine them.
Applicants for Federal loans should also keep in mind that even with a good credit score, a bankruptcy that was applied for within 90 days of filing a FAFSA application will result in it being rejected.
You borrowed a ton of money to pay for your tuition and other college expenses.
After four years, give or take, you graduated and entered the real world.
With that in mind, it’s not surprising the federal government decided that you should be able to take out these loans regardless of your credit score.
So there’s a good chance that you don’t have a really vast credit history when you take out these loans.