Student Credit Reports are a type of loan that is used to help a student start their college career with no debt. The winner of the 2018 Bank of America Entrepreneurial Challenge, Laurel Herndon, will discuss how she turned her credit card debt into Student Credit Reports and the impact it has made on her life.
What are Student Credit Reports?
Student Credit Reports are reports on the credit history of a student. They are used by universities and high schools to determine whether or not they should allow a student to enroll in school, or even grant them financial aid. These reports are usually very easy to obtain and have no cost.
Student Credit Reports were created in 1966 to allow institutions to assess the credit worthiness of a student before enrolling them. These reports have evolved over time, with more specific and detailed information about a student’s financial history.
How does it work?
Student Credit Reports are a tool many schools use to track student progress in school and beyond. Using this tool, teachers can analyze what students have learned, what they need to work on, and where they need extra support. Credit reports also have the potential to serve as a way for students to improve their own grades by identifying good or bad habits that may be holding them back.
Student Credit Reports alerts students and parents when their child’s credit score goes into a negative territory. Parents can then take steps to help the student improve their score and avoid future issues by setting up payment plans or communicating with their lenders to reduce the interest rates on loans.
Impact of Student Credit Reports
Unauthorized credit reports have had a tremendous impact in the United States, with about 16 million Americans having their public and private records compromised. Many students are unaware that these reports exist and may not realize how important it is to protect their trade school or college transcripts. These “student” credit reports can also be harmful in other ways, as they can limit a student’s ability to open up future lines of credit, such as mortgage loans and car loans.
Every student in America has a credit report, and these reports have a huge impact on their lives. Not only do they affect the way that students are able to access loans and scholarships but they also have the power to determine what careers students will be able to enter after graduating college.
Quotes from Laurel Herndon
“The student credit report is a tool the financial aid office uses to make sure students understand what they need to do in order to qualify for aid. The credit report includes information on the student’s grades, work history, and use of loans.”
Laurel Herndon is a student at Georgia Tech who is pursuing a Bachelor’s in Electrical Engineering. Laurel graduated from high school with a 3.9 GPA, but because of her financial situation, she was unable to enroll in college without taking out loans. She felt ashamed and embarrassed about not being able to afford an education without any help from the government, so she decided to take “full responsibility” for her debt. Laurel became an advocate for herself by researching how much interest she was paying on her loans and applying it towards her college tuition.