By Jason Koole
Western Herald
With costly tuition rates and the lack of available jobs, loans and credit cards are often the only viable options for students. What many students don’t realize is that credit card and loan payments affect their credit score.
According to the “Credit Score Guide” written by the Consumer Federation of America and the Fair Isaac Corporation, a credit score is generally determined by how well a person pays back their loans and debt.
Bad credit scores as well as taking out too many loans and credit cards can land a person in a bad financial situation. When this happens, places like American Debt Counseling are available to help. ADC is a corporation that helps people prioritize options to help with debt.
“When we assist people, we do consolidate but we are not a settlement company and we don’t give out additional funds,” said Melissa Mullins, manager of American Debt Counseling on S. 9th Street.
“We work with the income that you have coming into work with the creditors as they exist in the balances that are there,” Mullins said.
One of the things that can lead to debt early on in life is the usage of a credit card. Some students even have multiple credit cards.
“Yeah, [I own a credit card]. I have one for family emergencies with my dad, but I also have one in my name, which I’m not very responsible with; I have a bad habit,” said Rebecca Palombit, a senior at Western Michigan University.
“They’re a horrible thing, especially for college students. I don’t think you should be able to have a credit card in college unless your parents’ names are on it too. Students at this age need money, and they’re desperate. If they have it, they’ll use it.”
Palombit cites herself as an example of this idea.
“If I’m at the mall and I really can’t get anything, I’ll see something that I really want but really can’t afford at that time. I’ll be like, ‘well, I have my credit card, I’ll just use that,’ when really I probably shouldn’t,” Palombit said.
Like Palombit, senior Daniel Shoff has a credit card.
“I do [have a credit card], it’s more of a emergency thing. I like to get my books on it, and pay that off, and stuff like that- nothing too major,” Shoff said.
Shoff makes regular payments on his credit card and tries to pay his debt as soon as possible. Shoff and Polombit both have student loans that are deferred until after graduation.
Mullins is against students having credit cards due to students not realizing how much debt a credit card can cause.
“I’m very much against [students getting credit cards]. We have actually had booths at WMU during the time frames that you guys are all enrolling to try to communicate what that debt is going to be,” Mullins said.
“Many times students don’t realize that purchasing something on a credit card means you’ll be paying 3 times over that one purchase by the time you’re done,” Mullins said.
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