Hi Heather,

I work as a counselor at a non-profit so I’m sure I’ll qualify in 9 more years (made 12 payments so far.) At the same time, even though my payments under Income based repayment is only $15.00 a month, I carry some 90K of student loan debt ( I have a masters degree) that shows on my credit report. Everytime I try to obtain credit, this comes up. When I try to buy a home in the next year or so, I am fearful the lender will blow a fuse. Will those of us who are waiting and paying for 10 yrs have to suffer with a poor FICA score because of the high unsecured debt on our report? Whats’ your take?

The fact that we owe a bunch of money will indeed be reflected on our credit reports and will be considered by anyone contemplating a loan, yes.  Prospective creditors can find it tricky to evaluate how student loans affect cash flow, because we have so many repayment options.  I hear from some borrowers that a prospective mortgage company may require some convincing that a high student loan balance doesn’t necessarily mean a high monthly payment (because of IBR).  You won’t see negative marks on your credit from selecting a certain repayment plan or earning loan forgiveness, but late payments will of course reflect poorly.  But also, plenty of student loan borrowers build strong credit histories by making on time payments month after month.