Going into debt seems to be part of the process of getting a professional license. After all, the beginning of a professional license is typically several years of college and graduate school.
As you and others around you are taking on more student loans and increasing the limits on your credit cards, it would make sense that everyone is in the same boat. In most cases, however, debt, even student debt, can count against you when applying for a professional license.
Here’s what professional licensing boards look for when it comes to your debt.
Did you max out?
There is no amount that, if you borrow past it, a licensing board will not grant a license. Instead, they tend to look at factors such as:
- Borrowing far above your cost of living
- Reaching credit limits on multiple accounts
For some licensing boards, high amounts of debt make you a greater risk of committing financial fraud. Typically, if you accumulate a reasonable amount of debt during your schooling, it will not be an issue.
Have you been responsible in the past?
In addition to the amount of debt, licensing boards will also be interested in your past debt behaviors. The board will look at whether you have a history of late payments or excessive amounts of loans.
As you work toward your professional license, pay attention to your debt. Create a pattern of responsible borrowing habits. In some cases, if you can point to a current record of good practices, the board will consider that you are working toward a better record.
Keep in mind that you are not off the hook once you obtain your license. Some states, including California, may also revoke licenses for people who default on their student loan debt.