How credit hurts students

College students juggle plenty: part-time jobs, research projects, dating, keeping up with the family at home.

So I’d like to go out on a limb and say most college students are more focused on their GPAs than their credit scores. And it’s way too easy to make some really dumb moves on campus that can ding your credit score.

Lower scores mean higher costs when taking on adult-size purchases, such as car loans and mortgages, down the road.

Beginning in 2010, credit card companies could no longer offer T-shirts, coupons for free pizza, coffee mugs or other gifts on campus to college students who agree to fill out a credit card application. But they could still market cards on campus, just no freebies.

If a student is younger than 21, it is now tougher to get a credit card. But it’s doable. A credit card can be opened if consumers younger than 21 can prove they can afford payments or have a parent or someone else who is older co-sign for the credit card.

“If they want to get a credit card, they’re still finding ways to get credit cards,” said John Ulzheimer, president of consumer education at in Atlanta.

College students still can get into plenty of trouble when it comes to credit.

Todd Albery, CEO of Detroit-based Quizzle, a credit-information website that’s part of the Quicken Loans family, said he can easily think of two areas that cause college students to have lower scores: high credit card balances and credit inquiries.

Albery noted that many students don’t know that just applying for new cards can cause damage to a credit score.

It’s not as bad as missing payments, but it can add up.

Students should not use plastic as if it’s the same as cold cash. They can run into trouble if they buy items like pizza or new sweatshirts and jeans, and just keep charging.

If you charge $100 on a card with a $200 limit, it can ding your score. One realistic range of credit utilization, Albery said, is to use less than 25 percent of your available credit.

Even students who don’t have a credit card can get in trouble with their scores.

Gerri Detweiler, director of consumer education for, said she’s heard from many college graduates who are shocked that their credit scores have been hurt by unpaid utility bills.

They all move out of the house or apartment they rented off-campus and no one pays the bill. It goes into collection, and the student with the name on the bill gets hit on the credit report.

Parents who are worried about credit may want to help a student build a credit history by adding a child in college as an authorized user on a low-balance card.

The parent or cardholder is responsible for the bill, of course, not that authorized user. So you really want to make sure that the student understands the limits. After all, a parent’s score could suffer if the college student maxes out that card.

On the plus side, when a parent authorizes a child as a user, Ulzheimer said, the parent is easily able to kick the child off the card if the student abuses the card. It’s harder to do if a parent co-signs for a card with a student.

College credit

•Check into options for opening a credit card at a local credit union, including any credit union affiliated with the university. Some deals could be better. lists several credit cards that might appeal to college students, including the Citi Dividend Platinum Select Visa for College Students, the Journey Student Rewards from Capital One and the Discover Student Open Road Card.

Be aware of when zero-percent introductory rates expire on a given card offer. Know what the new rate on the card will be in the future. Several variable-rate cards for students can range from 13 percent to 22 percent currently, depending on the borrower.

Pay bills on time and pay more than the minimum required as often as possible. If possible, don’t charge more than 10 percent or 20 percent of the available line of credit on a card.

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