Student Loans for Your Education Even with Bad Credit?

For most of us, college is a bridge connecting us with more career opportunities and a bright future.  But many students may financially strapped by the tuitions and educational fees. Then applying for student loans is an ideal way to help you get through the hardship.

However, if your credit score is poor due to the previous debts or mismanagement of money, things will get tough for you – you will find that most lenders would not like to offer you loans when they check your credit score.

Then, is there anything to do to fund your college life if you have bad credit?

Today, even with bad credit, you can still afford education, as there are many federal student loans that have nothing to do with your credit while offering you the money you desire to finance college education. Even if you carry bad credit or a limited credit history, there are still chances for you to obtain student loans, such as Federal Stafford Loans, Perkins Loans and other non-credit based loans designed for students in specific study areas like medicine and nursing.

• Federal Stafford Loans

This kind of loans has two types, subsidized and unsubsidized. The subsidized Stafford Loans are available for students in financial needs. If you are eligible, the federal government will pay the loan interest monthly while you are in school.  The unsubsidized Stafford Loans are available to apply for every student, regardless of their actual needs, which require the students to pay the interest part even while they are in school. Both types can be awarded to students with bad credits and allow deferred payment until you graduate.

• Perkins Loans

Federal Perkins Loans are another good financial solution for students with poor credit. Loans of this kind are available for both undergraduate and graduate students. The amount that is typically allowed for each school year ranges from $1,000 to $4,000, not exceeding $20,000 in total.

• Alternative Non-Credit Based Loans

These loans, such as Loans for Disadvantaged Students, Nursing Student Loan Program, and Primary Care Loan Program, are specifically tailored for students who are pursuing a degree in health science fields.

Loans for Disadvantaged Students, sponsored by the Department of Health and Human Services, are available for socially or financially disadvantaged students who are earning degrees in select areas of the health science.

Nursing Student Loan Program offers up to $4,000 per school year for students enrolled, at least half-time, into an approved nursing course. These loans feature low-interest and have a 9-month grace period.

On the other hands, for students seeking degrees in primary care, Primary Care Student Program funds them with non-credit based loans. However, the applicants must practice primary care throughout the entire term of the repayment.

The loans we mentioned above have no requirements on students’ credit as they are usually granted by the federal government. However, if for some reason, you are not qualified to apply for a federal student loan, a private student loan may do you a favor. Typically, private student loans have strict requirements on applicants’ credit. For those with bad credit, the approving process would take much longer. To enhance your chance of obtaining a private student loan, getting a co-signer would significantly boost your eligibility.

A co-signer is the person who agrees to share the liability of the loan. That is to say, if you fail to repay the loan, they will pay off the debts. He/she can be your parent or guardian, as well as a friend or a relative. When you apply for a student loan with a co-signer, both your credit and theirs will be checked. Therefore, if your co-signer has good credit, your bad credit will not weigh so much.

In most cases, your co-signer should meet the following requirements:

  •  With a credit score more than 700
  •  The one you trust and know well
  •  The one knows his/her responsibility on the loan

Besides, applying for private student loans with a good credit co-signer will help lower your interest rates and increase your chances of being approved.