If you miss a payment on a student loan or you are over 30 days late on the loan, the account is marked as a negative account and lowers your credit score. Negative accounts are limited in the amount of time that the lender can report the information, so the negative does eventually drop off of your credit report in seven years.
Credit Scoring
The information on your credit report is used to create a credit score. Many different factors go into the credit score calculation, such as your payment history, delinquencies, types of credit accounts and credit balances. The main area that a delinquent student loan affects is the payment history.
Credit Reporting
The issuer of your student loan reports the account to the credit reporting bureaus, TransUnion, Experian and Equifax. The reported information includes your minimum payment, your balance, your highest total balance, two years of payment history and the account status. According to Experian, accounts with negative notations, such as a delinquent student loan, report for seven years before falling off of your credit report.
Repairing
A delinquent mark on your credit report affects you more when it is recent. Over time, the impact of the late payments gets less and less. However, the negative impact is not entirely removed until the delinquent student loan falls off of your credit report entirely.
Re-establishing
As the delinquency ages, your credit score will naturally go up, but you do have other methods to help your credit score along. According to MyFICO, re-establishing positive credit lines following a delinquency will improve your score as well. You do not need to add another student loan account as a positive trade line; any type of credit account in good standing will work.
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