Skip to main content

I'm interested in starting a business, but I have student debt. What do I need to know?

It is possible to have student loans and start a business, but it may be harder to access business credit and save enough cash to cover startup costs.

The impact of student loans on your ability to get a business loan

By understanding the impact student debt can have on your credit and taking advantage of alternative payment options on your federal loans, you may be able to get closer to your goal of starting a business.

If you’ve been unable to make your monthly payments on your student debt, your credit score will be negatively impacted. Many business lenders consider personal credit history in deciding whether or not to give you a loan. This requirement may put new graduates or those with high student debt at a disadvantage – and may be a roadblock if you are an aspiring entrepreneur. By repaying your student loans on time and in full each month, you can boost your credit profile.

If you have federal student loans, you may be able to lower your monthly payments by enrolling in Income-Driven Repayment . If you have a private student loan, you may be able to refinance your loans to lower your interest rate. Having a lower monthly payment will allow you to make your student loan payments while also investing in your new business.

More resources for small business owners.