College Student Working on Financial Aid Paperwork Cardoza Law CorporationNegative entries on your credit reports have an impact on many areas of your life. When your credit report looks bad because of errors you can’t get corrected or unpaid accounts opened by an identity thief, you are right to be concerned about the effect it will have on your ability to finance a new car, open a credit card, or even get a job. But do you have to worry about how it will affect your student loan or other financial aid? In most cases, no. We explain here.

What Is the Source of Your Loan?

If you or your child is borrowing money to finance your education, a poor credit score will only have an effect if you are taking out a loan from a private source, such as a bank or credit union. If you have been offered a loan through the Federal Student Aid office because of your financial need, a poor credit score or bad credit report will not have an effect. In fact, when processing your Free Application for Federal Student Aid (FAFSA) form, the government will not even pull your credit report.

However, if you don’t qualify for a federal student loan but still need to borrow money to pay tuition or other fees, a bad credit report will definitely have an effect. If your credit report is messy due to mistakes or identity theft, it is vital that you get it fixed before applying for a loan. A poor credit score may prevent you from being approved for a loan, and will definitely affect your interest rate if you are approved.

When You Need Help Correcting a Credit Report

Wherever you are in the process of correcting mistakes or removing accounts opened by an identity thief from your credit report, the Cardoza Law Corporation can help. Contact us for help with notifying the credit reporting agencies about mistakes on your credit reports. If you have been through this process and have not been able to get your reports fixed, you may have grounds to file a lawsuit for damages. If you do, we will explain the process and help you get the compensation you deserve.


Michael F. Cardoza, Esq.
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U.S. Marine & Consumer Financial Protection Attorney helping victims of ID theft and Credit Reporting errors.