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Millions of Americans are taking hits to their credit scores from delinquent student loans.
An analysis by the Federal Reserve Bank of New York shows credit scores dropped by more than 100 points for over two million delinquent student loan borrowers. Scores fell 150 points or more for more than one million in the first three months of 2025. It’s similar to the sharp drop that follows a personal bankruptcy filing.
Researchers said about two million of those previously had favorable credit scores and would have qualified for car loans, mortgages, or credit cards before the delinquencies were reported.
