NASFAA and Fair Isaac have released a statement detailing how your credit score will be impacted by shopping around for a student loan, especially PLUS loans and private student loans:
Fair Isaac Corporation, the creator of the FICO score used by the majority of creditors in underwriting credit requests, recently clarified that shopping for the best priced private education loan does not necessarily lower an individual’s credit score. Fair Isaac clarified that, similar to car or mortgage loans, student loan inquiries that are made within a relatively short time frame (e.g. 30 days) will lower a FICO score by only a few points, if at all. This is good news, as some have feared that multiple creditor requests to credit bureaus regarding student loans could be viewed as separate inquiries, which does negatively impact an individual’s credit rating.

This is an update to previous guidance that shopping around for student loans could have significantly impacted your credit score negatively.

Our recommendation is that you shop around, figure out who you want to apply with, and then submit only a few applications within the recommended 30 day time period. Before you apply, it’s a good idea to check your credit report and clean up any items that are in error or omitted.

To compare private student loans, check out PrivateStudentLoans.com.

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