Private Student Loans Without Cosigner

Obtaining private student loans without a cosigner is a popular student loan topic. Many college students simply do not have enough credit, or may even have bad credit, which prevents them from securing certain kinds of student loans without the help of a creditworthy cosigner. Typically, when referring to “student loans without cosigner”, the reference is to private student loans without a cosigner, since private student loans are based on a borrowers credit history and/or standing. Most federal student loans do not require a cosigner, regardless of the borrowers credit history, because most federal student loans are based on financial need and not on credit (PLUS loans will require the borrower to pass a credit check).

Where the problem exists for many students, is that the amount of money they receive from federal student loans is not enough to cover the costs of their college expenses. For most college students, the logical next place to turn in order to make up the difference between what they have received in federal financial aid and what they actually need to cover their college expenses is private student loans. Unlike federal student loans for college, private lending institutions and banks offer private student loans. Similar to most other types of loans offered by private lenders, private student loans require a credit check in order to assess the risks associated with lending money to each individual borrower. For borrowers with bad credit (or little credit history), securing a creditworthy cosigner such as a parent or legal guardian will greatly improve your chances at securing the private student loan, and may even improve the interest rate you will qualify for. This is because the lender will factor in the cosigners credit profile when determining its lending risk. If the cosigner has an excellent and established credit profile, and is willing to cosign on the loan (which means they agree to be held responsible for paying back the loan should you stop making payments), the lender will likely view this situation as less of a risk, and therefore extend the loan to you.

Many students are in need of “student loans without cosigner” or “private student loans without cosigner”, however, unfortunately there is typically no way around securing a private student loan without a cosigner if you have bad credit or no credit at all. For those students who are in need of more money for college and are unable to obtain private student loans without a cosigner, you may need to revisit your scholarship, work-study, and/or employment options as a means to help fund your college education. Over the past few years some peer-to-peer lending sites have also gained notoriety. It may be worth looking into the qualifications for a peer-to-peer student loan, for those students willing to try something less conventional than a private student loan. Students are also encouraged to speak with their schools financial aid office. Your school or college may have special payment programs available specifically to their students. Readers can view some additional options and more information under our Loan Alternatives section or our College Financial Aid Tips section.