Can you get a student loan without a cosigner and no credit history?

by Kedy J. Writer College can be really expensive which leads many struggling students looking to financial aid to help pay for it. If, like a great deal of recent graduates from high school, you have no credit history or your credit score is low, seeking out a cosigner to get a student loan might be your only alternative. A cosigner is someone who signs for the student loan with you, which helps to guarantee the debt will be covered if you are unable to pay it. However, it would still be your debt. Your cosigner, along with you, is also responsible for it; therefore, it affects both your credit scores. But, what if you do not have a cosigner and you have no credit history either? How can you get a student loan without a cosigner or credit?

Private Loans

Many students think they will automatically have a handful of lenders eager for their business waiting to hand them over a loan. Unfortunately, this is not the case. According to FinAid.org, a student finance website, over 200 different lenders have suspended or stopped their loan programs for students since August of 2007, which has raised the competition significantly for students looking for non-federal school funding. Thankfully, student loans without a cosigner or credit are obtainable. You can first try to increase your eligibility for a private student loan by following the tips below.

1. Raise Your Credit Score. If you are looking into a private student loan, after all your federal loan options have been exhausted, it all factors into your credit score. There are not as many companies today making these loans and these loans usually come attached with hefty rates, so you will need to either have a decent credit score or obtain a cosigner. If a student's score falls below 650, which is usually the minimum required for getting a private loan, and they are trying to get a student loan without a cosigner they can begin to clean up their scores by getting their credit reports, looking to see if there are any errors on them and starting to pay off their outstanding debt.

2. Plead your case. When a bank rejects an application for a loan, it usually has nothing to do with you, personally. In some cases, the lenders are refusing loans for institutions that have a high record of default rates, particularly schools for profit. It can be very challenging obtaining a loan if you are planning on attending a school that has a low graduation rate, too. If you plan on attending this type of institution or if you are looking to attend a community college or a low-cost school that does not necessarily require a huge student loan, you might address the situation with the lender and see if you can come up with a compromise.

Student Financial Aid

In many cases, college students find it challenging to pay school fees. Not to mention school expenses are constantly being increased. This is where student financial aid can come in handy. There are various ways to obtain this type of help with a few of them listed below.

• Check for Scholarship Contest Opportunities- One of the financial mistakes made by students is not checking for scholarship applications. If you really check into it, you will find many forms of scholarships available for both academic and non-academic purposes. Some are even awarded on a contest basis, like essay competitions, for example. Do not be intimated by these types of contests since winning is a good possibility.

• Federal loans- Instead of turning to your credit cards, your parents, or private loans, it might be a better choice to apply for a federal loan. These types of loans can help in various ways. You will spend less on private loans if you take advantage of federal loans first. You can even borrow up to $7,000 as an undergraduate if you are a dependent student. However, do not use a private loan to cover any balance due.

• Applying for Financial Aid- If you really seek financial help, do not hesitate to get to the financial aid office and apply. Applying for this type of scholarship will take into consideration your properties and your family's income. Your parents employment will also be checked to verify whether or not they are able to help pay for your school expenses.

Checking Your Credit Score

If you enter college with a credit history, remember to always get your credit score before you apply for a student loan. It is common knowledge that bad credit will result in an application rejection and could hurt future loan eligibility. Your actions now will have an impact on your future status. College should not be used as an excuse to not be financially responsible. In fact, you should prepare early to handle your finances and debt that will come in the future.

Since many people cannot afford to pay college expenses without the help of some form of financial help, often struggling students will go after student loans to get their education. In the event you are unable to get a private loan due to not having credit history or a cosigner, knowing your other options is essential.

Kedy is an active finance blogger who is fond of sharing interesting finance management tips to encourage people to manage their personal finances. More specifically, she advocates that people should check credit reports and scores regularly.

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Created on Dec 31st 1969 18:00. Viewed 0 times.

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