College is expensive, and as a result, many students need to take out loans to pay for their education. Getting a loan is not the easiest task on a student’s list. However, getting a cosigner can increase the chances of getting student loan approval. If you have no credit history or poor credit score, there are alternatives to getting a loan without a cosigner.
Who is a cosigner?
A cosigner is a person who agrees to repay the loan if the borrower does not. If a cosigner is added to your application, they’re often called a co-borrower, guarantor, or co-signer. The terms are used interchangeably in most cases and refer to someone who has agreed to be responsible for repaying your student loans if you can’t.
How to borrow federal student loans without a cosigner?
The first step to getting a loan without a cosigner is applying for one. For example, you can apply for a student loan online at the Student Loan Center website. You may even apply via phone and email.
Once you’ve applied for your loan, it’s time to determine what types of aid are available to students to decide which type of federal student loan will work best for your situation. The types of loans offered through the Federal Student Aid program include:
- Unsubsidized Direct Subsidized Loans
- Direct Loans (Unsubsidized)
- Direct PLUS Loans (Parent and Graduate)
How to get private student loans without a cosigner?
If you’re an undergraduate or graduate student, you may be eligible for private student loans with no cosigner. This is an attractive option if you have an established credit history and good income prospects but no cosigner available to help you get approved.
If your parents won’t cosign on your private student loans because they don’t have the necessary credit score or income, there is still hope! You can still get the loan that will allow you to pay for classes and go on with life.
According to the experts at Ascent, “Student borrowers without established credit**, and those who meet the minimum credit requirements but don’t meet the income or repayment requirements may qualify for a loan without a cosigner on the basis of several alternative factors:
- Be a college junior or senior enrolled full-time (or with expected graduation date within 9 months of the loan application being submitted) in a degree program at an eligible institution.
- Be a U.S. citizen or have a U.S. permanent resident or Deferred Action for Childhood Arrival (DACA) status.
- Maintain good academic performance with a 2.9 GPA or greater.
- Be at least 18 years old or the age of majority in their state of residence.”
Alternatives to a student loan without a cosigner
There are alternative ways to get student loan approval without a cosigner. One option is to refinance your loans, which means you would consolidate or combine multiple private or federal student loans into one new loan with a lower interest rate.
Another option is to consolidate your current loans by combining them into a single loan at the end of repayment. Consolidation can be an excellent tool if you have multiple private or government loans and want to manage them all through one lender.
Still, it may not be suitable for everyone since consolidation means extending the length of your repayment term—it can also increase monthly payments and result in higher total costs over time.
The third alternative is a repayment plan that allows you to make smaller payments on certain types of federal student loans until they are paid off early (certain conditions apply).
Studying student loans is a complex process, and you must consider many factors before applying for one. However, if you’ve understood everything before getting the education loan, then there is no reason why you should not be able to get one.