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Bad credit or no credit history can make it difficult to get one private student loan. But taking out a personal loan is not your only option.
If you need to borrow for college, you should exhaust all federal loan options first before considering private student loans. Most federal loans do not require a credit check.
This is what you should know about taking out a student loan with a bad credit bureau.
Even if the credit bureau is bad, you can find a private loan to finance your studies. Visit credible View your prequalified student loan rates from different private lenders, all in one place.
The best student loans with bad credit
To qualify for a bad-credit private student loan, you may need to apply co-signer. A co-signer is someone who agrees to be responsible for paying back your loan if you are unable to make payments.
Some lenders allow you release a co-signer after you have made a certain number of timely payments. The approval process varies by lender, but you are typically required to submit a co-signer approval request after making the required number of payments. After filing, a lender performs a credit check and checks your income to assess your ability to repay the loan.
The following credible partner lenders are some of the best private student loan lenders to consider if you have bad credit.
Ascent offers student loans up to $200,000 if you need a credit check. For the non-credit based loan, the maximum loan amount is $20,000. Ascent offers a wide variety of payment terms, ranging from five to 20 years.
In addition, you can receive an interest rebate when you sign up for Autopay and a 1% cashback bonus if you graduate within five years.
- Minimum creditworthiness: 660
- Conditions: 5, 7, 10, 12, 15 and 20 years
- Maximum loan amount: $200,000
- Co-Signer Release: After 24 months
If you are planning to attend school in Indiana or are already a resident, INvestED may be worth considering. You can borrow up to 100% of your school’s attendance costs, and InVestED’s repayment terms range from five to 15 years.
- Minimum creditworthiness: 670
- Conditions: 5, 10 and 15 years
- Maximum loan amount: Up to 100% of your school’s participation costs
- Co-Signer Release: After 48 months
HOW MUCH CAN YOU OBTAIN STUDENT LOANS?
MEFA offers student loans for undergraduate and graduate students attending nonprofit colleges or universities in the United States. You can borrow from as little as $1,500 up to the cost of your school (minus any financial assistance you receive), and loan terms range from 10 to 15 years.
- Minimum creditworthiness: 670
- Conditions: 10 or 15 years
- Maximum loan amount: Up to 100% of your school’s attendance costs (less financial aid received)
- Co-Signer Release: After 48 months (15 years undergraduate loan)
Other lenders to consider
The following lenders are not credible partners so you cannot easily compare your rates with them on the credible platform. However, they may also be worth considering if you are looking for a student loan for bad credit.
Earnest offers student loans from $1,000 to $250,000. You can choose from a variety of terms ranging from five to 15 years. You’re also allowed to skip up to one payment each year, which can help when you’re struggling financially.
- Minimum creditworthiness: 650
- Conditions: 5, 7, 10, 12 and 15 years
- Maximum loan amount: Up to $250,000
- Co-Signer Release: Not available
2. Funding U
Funding U only offers non-cosigner loans for undergraduate students. You can borrow up to $20,000 and the loan term is 10 years. There is no minimum credit rating, but Funding U will review your credit history. If you have collection accounts or missed payments on your credit reports, your loan application may be denied.
- Minimum creditworthiness: none
- Conditions: ten years
- Maximum loan amount: $20,000
- Co-Signer Release: Only offers no co-signer student loans
Rated credible private student loan lenders in 10 different categories to identify the best student loan lenders. This included interest rates, repayment options, terms, fees, discounts, customer service availability, and eligibility requirements and co-signer sharing options.
HOW TO RELEASE A COSIGNER FROM YOUR STUDENT LOANS
This is how you take out a student loan with a bad credit bureau
If you think taking out a student loan is the right move for your situation, follow these steps:
- Complete the FAFSA. First fill out the free application and send it off Federal Student Aid (FAFSA) to help your school determine if you are eligible for federal loans and other types of federal assistance, such as B. the federal work study program, scholarships or grants. Federal loans provide access to benefits that private lenders do not, such as: B. Income-Related Repayment Plans (IDR) and access to student loan forgiveness programs.
- Consider private student loans. If you’ve exhausted your federal loan options, consider taking out a personal loan to fill funding gaps. Compare loan terms and interest rates from at least three to five lenders to get the best deal for your unique financial situation.
- Add a co-signer. If you have bad credit, you’ll likely have a hard time qualifying for a personal student loan on your own. And even if you qualify, a lender will likely charge you a higher interest rate. You can increase your chances of approval and a lower interest rate by adding a co-signer who has good credit and a solid income.
- Improve your credit score. If you don’t need a student loan right away or can’t find a co-signer, increasing your loan before applying can increase your chances of qualifying yourself. You can do this by adopting good credit-building habits, such as: B. Paying off any debts you owe and paying all bills on time. In addition, it’s also a good idea to check your credit reports for inaccuracies from all three major credit reporting agencies — Equifax, Experian, and TransUnion — by visiting AnnualCreditReport.com.
When you’re ready to apply for a personal student loan, Credible makes it easy to apply prequalified student loan rates from multiple lenders.