How to Get Approved
To get approved for private student loans, you need to build your credit. Thus, building credit to get approved is essential. There’s no doubt about that. It seems nearly all private student lenders have a caveat. And it is; that to be approved without a cosigner, you must have good credit.
So if you have no credit history and want student loans, no cosigner, you’re likely out of luck. But how can you get credit? And what is good credit anyway? According to Experian, good credit means a 700 or above FICO credit score. Your credit score is a value that shows your credit worthiness.
This helps lenders determine the likelihood you’ll make good on your loans. Credit is built primarily through your payment history and credit utilization. This makes up 65% of your credit score. Following these actions may boost your credit:
- Pay back your bills and credit cards on time every month.
- Keep balances on your cards low, ideally less than 30% of your overall limit.
- Also, be mindful of opening too many new accounts which could have a negative effect on your credit.
Considerations Before Applying
Are you ready to apply for private student loans without a cosigner? If yes, then, please pay attention. First, check your credit report at AnnualCreditReport.com. This is to make sure everything is correct.
Also, check your credit score. Once you know your credit is in good shape, you can apply. However, before accepting a loan, check out:
- Origination fees.
- Application fees.
- Repayment terms.
- Repayment options.
All of the above have impact on your experience as a borrower. Doing your due diligence and knowing these aspects of your loans can help you avoid any mistakes.
Some Lenders Offering Private Student Loans without a Cosigner
Being young with limited, poor credit, or no credit history at all, can be tough. It can be tough to get your loan approved. To get a loan in this situation you’ll need a cosigner. However, there are some private student loans with no cosigner available today. Below are some of them:
1. Sallie Mae
Sallie Mae is one of the most popular private student loan lenders. Also, it offers without a cosigner. However, you must have good credit to be approved.
If you’re going for undergrad, it’s unlikely you have enough history for approval. Graduate students may have better odds of getting approved for student loans with no cosigner.
2. Funding U
It offers undergraduate loans without a cosigner. As a smaller scale lender, you can borrow up to $5,000. You can get pre-qualified quickly in just two minutes time. They use info based on your federal loans as well as academic success as part of their lending decision.
3. Citizen’s Bank
Citizen’s Bank offers without a cosigner. It offers to borrowers with good credit. Also, there are no application or origination fees. Additionally, you can score up to a 0.50% interest rate reduction.
This is by signing up for autopay (0.25%) and if you already have an account with them (0.25%). There are 5-, 10- and 15-year repayment term options available.
This is another private lender. CommonBond offers for undergraduate and graduates. However, those loans require a cosigner. Also, now they offer loans to graduate students in many cases without a cosigner.
Please note that medical loans are costly. As such, being able to go without a cosigner is huge. This offer will also allow low payments of $100 per month while in residency.
Although most undergraduate and graduate students looking for private student loans still need a cosigner, CommonBond’s medical loans are an exception.
5. Discover Bank
Discover bank offers private student loans without a cosigner. However, you must have good credit to get approved. If you have limited or no credit history, you’ll need a cosigner.
But if you have established credit and it’s in good shape, you can get student loans without a cosigner. However, there’s an exception for international students who do need a cosigner and are U.S. citizens.
Comparing Federal Student Loans with Private Student Loans
When comparing federal student loans with private student loans you will see that:
Federal student loan borrowers can opt for income-driven repayment. This is to make payments more affordable. On top of that, there is student loan forgiveness available under a variety of programs. Also, you can defer your loans, if need be.
But, private are limited in the benefits they offer. Also, they can vary by lender. However, there’s definitely no forgiveness or income-based options. Also, federal loans come from the government; private loans come from financial institutions.
Most federal loans require no credit check or cosigner. However, private student loans are credit-based and require a cosigner. However, both serve the same purpose. This is to pay for your education. Though they do the same thing, they differ as shown above.
In a Nutshell
From the above therefore, it’s apparent that there are private loans without cosigners. Also, you are aware of the differences and similarities of federal and private student loans.
As a result of the comparison above, you may chose maxing out your federal student loan options first before even considering private. Be that as it may, always carry out your research very well before making a choice. Also, please note. Private option should be something that should be evaluated carefully.