Student Loans Without a Cosigner

cosigner for loansStudent loans are designed for college student borrowers, and meant to help students cover the cost of their college education. However, most student loans also require a cosigner to guarantee that the borrowing student will repay the loan, or that the cosigner will step in to pay the loan in case the student fails to do so. While this is understandable from the lender point of view, it can sometimes cause problems for the student borrower if you cannot find a cosigner with a good credit history. Do not worry, though, because there are some student loans out there that are offered to students who do not have a cosigner. The foremost examples of student loans without cosigners are federal student loans. Federal student loans are not based on credit, but on the borrower’s desire to receive financial aid. In addition to these federal student loans, there are some private lenders in the market who do not require students to have a strong credit history and cosigners when applying for student loans.

Benefits of Student Loans without Cosigner

Applying for private student loans without a cosigner means that your chances of loan approval drop dramatically making it almost impossible to get a loan. It is therefore advisable to apply for federal loans instead of pursuing a private loan option without a cosigner.  Federal loans, such as the Stafford and Perkins loans, are additionally beneficial, as they have relatively low interest rates and flexible repayment periods, designed to assist students in making their repayments in the easiest possible fashion.

Disadvantages of Student Loans without Cosigner

Everything has its pros and cons, and the same is true for student loans without a cosigner. The borrowing limit for federal loans is not that high, so they may not be sufficient for seeing you through college and covering all your expenses. Grants and scholarships also add to your financial aid package, but even so, you may still need to turn to private loans. However, there are not that many private lenders who are willing to loan you money with a bad or no credit history and no cosigner. Moreover, a private loan without a cosigner usually has higher interest rate, which is, in the long run, more financially draining for you.

Applying for Student Loans without a Cosigner

Applying for federal loans such as Stafford Loan or Perkins Loan is quite simple. Keep all your tax and financial documents handy, and fill out your Free Application for Federal Student Aid (FAFSA). If after receiving your federal financial aid package and you still need funds for college, then visit our website and check out our student loan comparison tool. Compare all the loans, select the one without a cosigner that is the most suitable for your needs, and apply for it.

 

Types of Student Loans