Build Your College Student’s Credit with a Home Loan

It’s that time of the year again, when parents are preparing to send their children away to college for the first time (or second time or third time). While attending orientation, registering for classes and purchasing books are all necessary strategies to prepare your young adult for college, this also needs to be the time your prepare your young adult for life. Many parents struggle to find effective ways to build credit for their 18-year-old and start by applying for credit cards with 25% APR and only a $500 limit. While, this is definitely a starting off point for your college student’s credit life, one of the most effective and sound investments to build credit for a college student is through the FHA loan program.

Also known as the “Kiddie Condo Loans,” the FHA loan program has become a popular trend among savvy college parents. With the parent’s help, a college student can qualify for a home loan with as little as $500. There is nothing better than a mortgage loan for boosting a credit score, and many college towns have new homes and resale homes that could have a lower monthly mortgage than rent at a nearby apartment complex. There are a few regulations for the program, which you can read in further detail on this article from the Appen Newspapers, but the bottom line is that by co-signing a home loan with your college student, not only are you providing them with a secure home for the next four years,  but also giving them four years of excellent credit-building tactics.