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Posted in Student Loans
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Question By
benz420

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Why did taking out a student loan tank my credit score?
I was making progress on fixing/improving my credit over the month of February. I was able to go from 'poor' to 'fair' using the recommendations from CK, then I took out a student loan for around $9k and obtained an auto loan. The auto loan was reported to both Equifax and Transunion, and my Transunion score went up, but the student loan was only reported to Equifax and my score plummeted 39 pts!! What gives?! Is that normal? Should I be contacting Equifax about it?

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Top Contributor
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yes its normal.

in fact you may see your other score drop as well. 

Almost anytime you take out a new loan you will see a drop in your scores.  It will generally bounce back after a couple of months. Theres no need to contact anyone, There would be little they could do anyway., 

Scoring algiritums are different for each company So some will be more sever in scoring than others, Specially if your still rebuilding your credit. 

Hang in there

Good luck

Top Contributor
39 Contributions
23 People Helped

It happens

When you pay stuff off as well. I had three student loans go zero balance and then report "closed", score went down with one stayed the same with the other. Then a couple of months later all went up.

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