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Students Need to Work Harder for Credit Score

By Sally Maison
Published: Thursday, November 12th, 2009

Most American consumers are having trouble keeping their credit score. With the economy going bad for everyone, it is not a surprise to see students struggling with their credit score as well. But specialists advise college students to work harder to improve or at least keep their rating from going down since they will need it now more than ever as the costs of education continue to rise. The increase implies that more collegians will be applying to student loans to get an education.

Students Need to Work Harder for Credit ScoreA report by the College Board reveals that tuitions increased for the 2009-2010 academic year while state funding and endowment for schools went down. According to Gaston Caperton, president of the College Board, this makes many students feel that a college education practically unreachable practically unreachable although they acknowledge its great importance.

The report shows that the average tuition in private, non-profit colleges for 2009-2010 has increased by 4.4 percent and now stands at $26,273. Specialists say it is all the more important for collegians to work on their credit score to avail loans that will finance their education.

Both in- and out-of-state tuition for public universities also raised tuitions. An average public, four-year school had an increase of 6.5 percent and is now up to $7,020. Out-of-state tuition has gone up by 6.2 percent and is now at $18,548.

Caperton said states and educational institutions must work their best to prevent costs and tuitions from rising rapidly, adding that families who are having difficulty meeting fees must seek additional options to fund their college student.

The College Board report also shows that costs for board and rooms remain affordable for college students who have full time jobs. But the fact that a huge portion of collegians do not have full time work while in school makes it very difficult for many to pay those expenses. Experts say this only means that student loans will rise this academic year, adding that many loan applicants in recent years paid on high interest terms because they had low credit score while in school.

Specialists advise students to improve their rating first before going to a creditor to get the best deals available. One of the ways they cited that would help on the students’ ratings is by trimming down on their credit card debt.

A recent report by Sallie Mae reveals that students are using their credit card increasingly with an average senior carrying a $4,100 balance on his plastic. In 2004, graduating students only had $2,900 on credit card debt. Experts conclude that the trend is not good on their credit score and must be stopped.

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