Credit

Therefore, establishing and maintaining good financial credit is very important, now and throughout your life. Good credit can open up opportunities for you – education loans for law school, the ability to make large purchases such as a home or car, renting an apartment, even landing a job you want.  Bad credit can limit such opportunities.

Credit Reporting Agencies

The three major national credit reporting agencies are:

Experian
Equifax
Transunion

You may request one free copy of your credit report every 12 months.  (For more details, go to www.ftc.gov to look up the Fair and Accurate Credit Transaction Act of 2003 or go to www.annualcreditreport.com.)  You will also be eligible for a free report if you are turned down for credit on the basis of a report provided by one of the agencies.  The websites of these credit reporting agencies will help you to make that request.

We strongly recommend that you check your credit before assuming it is good.  Mistakes can be made.  This is especially true if someone at your address, or with a very similar name, has been irresponsible with his or her credit.  Resolving problems in the spring will help the fall disbursements to arrive on time!

A few of our students have such bad credit histories that lenders are unwilling to lend them Grad PLUS or private loans.  This can be a real problem, and may result in students having to withdraw or take a leave of absence until the credit problems are resolved.  Students with poor credit may be able to find lenders willing to give loans with co-signers or willing to give loans to parents or others with good credit who agree to borrow on a student’s behalf (sponsored loans).  If you believe credit will be an issue for you, you are encouraged to contact us as early as possible to discuss your particular situation.

Deferment Forms for Borrowers of Undergraduate Loans

One of the most common causes of bad credit for law students is the failure to file deferment forms for undergraduate loans.  Students who have borrowed federal or private education loans as undergraduates, or while enrolled in a prior graduate program, should contact their lenders to inform them that they are returning to school.  Graduate students are eligible for in-school deferments if they are enrolled at least half-time, which Fordham defines as at least six credits per semester (or three credits in a summer program).

Do not assume that because you are a student you can stop making payments on your prior educations loans.  This will result in a delinquent account on your credit report.  You must file the necessary forms and continue making payments until you receive approval of the deferment from your lender. 

Maintaining Good Credit

So, maintain good credit and protect your good credit, now and forever.

1.  Pay your bills on time.  To help, set up some sort of simple record-keeping system (Quicken, file folders, notebook, calendar) so you will know how much you owe and when the payments are due.

2.  If you have trouble paying any bills in full, talk to the company/ies about arranging for partial payments over a longer period of time.  Don’t just ignore the bills.

3.  Don’t obtain too many credit cards – the temptation to use them all may be great and your ability to make full payment each month while in law school is probably very low.

4.  Request that free credit report regularly.  If you see incorrect information, correct that information immediately by writing to the company that reported the information and by writing to the credit reporting company.  Log onto www.ftc.gov/credit for more information on correcting mistakes in your credit report.