For the first time since 2020, student loan repayments will be reported on consumer credit files with potential consequences to consumer credit scores. A VantageScore special quantitative analysis recently covered by Bloomberg offers insight as to the potential ramifications of both positive and negative reporting for student loan borrowers.

According to VantageScore’s analysis, student loan borrowers who are making their payments on time are already benefiting, potentially seeing credit score increases of up to eight points. However, the analysis also found that borrowers who have missed payments could see scores drop by as much as 129 points. More than 9 million borrowers are currently behind on their student loan payments, comprising an estimated 43% of government loans, according to Department of Education data analyzed by VantageScore.

Borrowers can expect their credit scores to quickly reflect these student loan repayment habits. “A credit score is like a reputation, it takes a long time to build but can fall very quickly,” said Dr. Rikard Bandebo, EVP, Chief Strategy Officer and Chief Economist at VantageScore.

Delinquencies related to missed student loan payments will start appearing on consumer credit files between now and May. Once that happens, VantageScore expects 2.3 million people to see their scores dip below 600, the threshold to be considered subprime. VantageScore said that 32% of borrowers are likely to be past due have prime (661 to 780) or super prime (781-850) scores.

Learn more about VantageScore’s analysis on the resumption of reporting on educational debt here: https://www.vantagescore.com/vantagescore-analysis-finds-benefits-for-borrowers-who-resume-student-loan-payments-while-many-will-see-lower-credit-scores/

Read the full article here: https://www.bloomberg.com/news/articles/2025-02-27/student-loan-payments-borrowers-behind-on-bills-set-to-see-credit-scores-drop