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Applying for Student Loans Without a Cosigner? Here’s What You Need to Know

Having a cosigner on your student loans comes with tons of benefits. A cosigner on a loan could be a parent or a guardian who agrees to pay back your debt if you cannot. Having this guarantee can make you more likely to qualify for loans and give you access to lower interest rates. Now, that sounds like a pretty good deal. In fact, it may sound like you need a cosigner to get the best student loans. But that’s so not true. If you’re applying for student loans without a cosigner, all hope is not lost. You’ve still got plenty of awesome options to get student loans to cover your college costs.

What do I need to get federal student loans without a cosigner?

Other than their superior benefits over private loans, the very best thing about federal student loans is that you never need a cosigner. All you need to do to get federal loans is complete the Free Application for Federal Student Aid (FAFSA). There are many different types of federal student loans you can be eligible for – like subsidized and unsubsidized. So, you should have at least one or two great federal aid choices.

Why don’t federal loans require a cosigner?

While private student loans are based on credit history, federal student loans are approved based mainly on financial need. If you have a weak credit history or none at all, you can still get federal student loans. Thus, you don’t need a cosigner with good credit to guarantee repayment of the loan.

What do I need to get private student loans without a cosigner?

This is a tougher task. Private student loans almost always depend on credit history and good income. Lenders want to see that you’ll be able to repay your loans. With a cosigner who has a good credit history and steady income, the lender can be assured that someone will repay the loan if you cannot. Without a cosigner, they would be taking a risk lending money to someone who has limited or no history of repayment.

It’s not impossible to get private student loans without a cosigner but it’s definitely difficult. And if you get approval for a private student loan without a cosigner, you’ll almost certainly have much higher interest rates. While you could always take out these higher interest loans and refinance them later, this is still a dangerous move.

What if I don’t have a good credit score?

Considering that the average credit score for people between the ages 18-24 is 630, you shouldn’t feel bad. It’s normal to not have established credit or even good credit before college. And the best thing about student loans, both federal and private, is that they give you the opportunity to boost your credit score during and after college.

Do you have time before you apply for student loans?

If you’ve got some time before you need to apply for student loans, you can work on building your credit in case you do want to explore private loan options. Typically, you’ll need a credit score above 650 to get approval on private student loans without a cosigner. If you don’t have time, don’t give up when you don’t get approval right away. You can explore other lenders who might be more flexible. You can also look into options outside of student loans.

What other options do I have?

If your federal student loan options are less than ideal and you can’t get private student loans without a cosigner, don’t freak out. You can raise that college cash in other ways that come with less regret than student loans do.

1. Apply for grants and scholarships

Free money is the best kind of money for college (and can’t land you in default down the road). Cast a wide net and apply for as many as you can to increase your chances.

2. Work part-time while you’re in school

There are work-study positions and off-campus jobs aplenty. Having a part-time job can help you cover a good amount of your bill.

3. Study at a less expensive school

If you have your sights set on an out-of-state or private college, it might be worth doing a cost comparison with an in-state or community college. You won’t believe how much money you can save.

4. Seek employer tuition help

Some employers offer aid with college costs. If you can land a job with a company that offers this benefit, it can be a truly ideal situation to make full-time bank while your employer pays for your education.

While it’s not impossible to get student loans without a cosigner, it can be difficult to land private student loans. There are some risks for cosigners, so not everyone will be willing to cosign a student loan with you. Rather than cosign, some parents prefer to take out loans themselves, like Parent PLUS Loans, on their kids’ behalf.

Instead of dwelling on why you don’t have a cosigner to make things easier for you, focus on what you can do. Put your energy into exploring your federal loan choices. And don’t feel restricted to student loans to foot your college bill.

Disclaimer: The viewpoints and information expressed are that of the author(s) and do not necessarily reflect the opinions, viewpoints, and official policies of any financial institution and/or government agency. All situations are unique and additional information can be obtained by contacting your loan servicer or a student loan professional.