How Is a Student Loan Payment History Reported?

Credit Report

If you have ever applied for and received a student loan for your education, that information is regularly posted to your credit report. Your credit report contains important financial information about you, such as credit cards, loans, payment history and public financial records. Each month the company or organization you received your student loans through, such as the federal government’s Direct Loan program, will report information such as whether your loan was paid on time, how much you paid, how much you still owe, and any special statuses (such as deferments or grace periods).

Late Payments

If your student loan enters payment status, and you owe money, you must pay the agreed upon monthly payment on time. If you do not, the grantor of the loan will report your late payments to each of the major national credit bureaus (Equifax, TransUnion and Experian). Late payments can remain on your credit report for up to seven years in most states. Federal student loan companies typically withhold reporting late payments to credit reporting agencies until they are at least 60 days past due, according to the Federal Student Loan Servicing website. Late payments can negatively affect your overall credit score and affect your ability to obtain credit in the future.

Default

If you are consistently late on your student loan payments, your loan grantor will report your student loan as defaulted. When a loan enters default, you are no longer able to receive further student loan funding until the loan is returned to a positive payment status, or is paid off in full, at which point the loan grantor will report the change to the credit reporting agencies. Defaults, like late payments, can also negatively impact your credit score.

Deferments and Grace Period

Special circumstances, such as loan deferments and grace periods, can also affect how your student loan payment is reported. While your loan is in an approved deferment or grace period, your payment history is reported to credit bureaus as paid on time.