Lending money is never easy, and it is especially difficult for students to get approved. Students are mostly busy with school work, leaving little time to earn the income that lenders are looking for. Students also tend to be young, without much, if any, credit history. As a result, most private lenders will only offer a loan with a cosigner involved – and sometimes there is no one to distribute.
It’s certainly possible to get loans without a cosigner, but it’s not always easy (especially if you want private student loans).
The One Sure Thing: Student Loans
The government offers several loan programs, some of which require no established credit history (so you wouldn’t need an assistant for approval). It is best to start borrowing with student loans for a variety of reasons.
- Loans are available without credit check or income requirements.
- Interest rates are relatively low and can be set over the life of your loan.
- Interest costs can be subsidized (or paid for by someone else) while you are at school.
- You may be able to use flexible repayment programs, such as post-graduation income repayments.
The education department makes it easy to get paid, but there is the same thing: you can’t borrow as much as you want. Government-owned loan programs have limitations (the maximum amount you can borrow for each term), and when you reach the limit, you need to look for other sources of funding.
If you need more than you can get from loans, then you can switch to private lenders.
Private student loans
Private lenders include banks, online lenders, and other companies or organizations that provide funds to students. Those lenders do not benefit from a government guarantee, so they make lending decisions based on your ability to repay: your credit history and income, mostly.
It’s hard to get a private student loan without a cosigner. However, if you are among the few students who have a consistent income and established credit history, you are in luck – most of your peers do not have any of them. You may be able to apply and get approved.
If you do not have strong income and credit, borrowing by itself is likely to be difficult and expensive. Unfortunately, you won’t have an easy road. Advertisements can promise easy approval, but they are most likely at their best – and the most serious of frauds. The sooner you know it, the better.
If you have some credit, you can always try to apply for a loan without a cosigner. But without a strong lender profile, lending is likely to put you off. While it doesn’t hurt to ask once or twice, your credit scores can be confused if you apply for loans multiple times.
Build your credit
A credit loan is not a quick fix, but it can eventually allow you to qualify for a loan yourself. Plan the process for two years or more and be aware that after that time you will not have the highest credit score in the world. However, if this is the only option you have and you are ready to wait, then it is a good option.
Build your credit history by borrowing responsibly. Even if you cannot borrow enough from the school, you may be able to get a small loan or a credit card. If you work part-time and can make $ 500 or something in the credit union, ask about a “secured credit card” or a loan that provides money, which will definitely help you establish a loan.
Things you own can be your key to credit, even though you technically don’t have a “student loan”. If you own a car, for example, you can secure the vehicle as collateral for the loan. You probably won’t get enough to fund your entire education, but it can help you get a few classes under your belt while building credit.
Security loans are generally expensive and risky, but they are an option if you need to graduate. If you go that way, borrow from major institutions like banks or credit unions that offer a multi-year repayment period (and be sure you can repay the debt early if possible).