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Student loans are a great way to help you pay for college, but you might be wondering if you can get them without your parents. The answer is yes, but it takes some work.
If you’re under 18 years old and don’t have your own income (like from a job), then you will need to ask your parents for their financial information so that the lender knows how much money they can use to lend to you. This means that if mom and dad aren’t willing to help out financially by filling out forms and providing information, then this isn’t going to work out—which is why it’s important not to wait until the last minute or until you’ve already been accepted into college before asking them for their help!
Luckily there are still options available! You can apply for loans with just one parent if they are willing to co-sign on the agreement. Make sure that both parties understand what this means before moving forward, though: If something happens down the road like unemployment or illness, then both parties could be held responsible for repaying those loans together (meaning both would have to pay back any missed payments).
How to Take Out Student Loans Without Your Parents
You can still take out both federal and private student loans even without your parent’s financial information.
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Getting a student loan without access to your parents’ financial information or credit history may be difficult, but it’s not impossible.
If you’re an independent student then you can borrow federal direct loans. If you have good credit, you can also choose from multiple private lenders. However, if you’re still technically dependent on your parents or you don’t have credit history, your choices are more limited.
No matter your situation, start by filling out the Free Application for Federal Student Aid, known as the FAFSA, and applying for federal student loans. They’re preferred over private loans due to their low interest rates, varied repayment options and loan forgiveness opportunities.
Here’s how you can get a student loan without your parents.
Take out a federal student loan as an independent student
You don’t need any parent information to apply for federal student loans if you’re an independent student. You’ll also have higher federal loan limits. You can borrow up to $57,000 in total federal student loans as an independent student, rather than $31,000 as a dependent student.
The answers you provide on the FAFSA determine your dependency status. If you answer “Yes” to at least one of the dependency questions on the application, you are considered independent. Use this checklist to prepare documents you’ll need to apply as an independent student.
However, you won’t be considered independent just because your parents won’t help with the process. If you answer “No” to all of the dependency questions on the FAFSA, then you’re considered a dependent student, whether your parents will provide their information or not.
Pursue unsubsidized loans without your parents’ information
If you’re considered dependent and don’t have one or both of your parents’ information, you can still apply for federal student loans. You have two possible routes:
- Get a dependency override. If you provide documentation to the U.S. Department of Education to prove you should be considered an independent student, you could get a dependency override. Approvals are made on a case-by-case basis and will apply only to students with unusual circumstances, such as an abusive family environment or parental abandonment.
- Apply for aid without your parents. If you don’t qualify for a dependency override but your parents are unwilling to share their information, choose the following option on the FAFSA: “I am unable to provide information about my parent(s).” You then must select the option that indicates you don’t have a special circumstance but can’t provide parent information.
Without your parents’ information, you won’t get an Expected Family Contribution, which usually determines your aid. You will be able to take out an unsubsidized federal loan only, if any loan at all. Your college’s financial aid office will decide whether to lend to you. Contact your school to discuss taking out an unsubsidized loan.
Find another relative or friend to co-sign a private loan
If you need a private student loan to fill a college payment gap, but your parents are unable to co-sign, consider asking a relative or close friend to do so.
Choose a co-signer who can qualify. That means they need a credit score in the upper 600s or higher and a steady income. Make sure your co-signer understands he or she will be required to pay your student loan debt if you can’t.
Private student loans, even with a co-signer, are more expensive than federal student loans because they carry higher interest rates.
Find private student loans that don’t require credit or a co-signer
If you have no co-signer and no credit, but still need a private student loan, look into student loans without a co-signer. Typically, these lenders will consider your future income potential instead of your credit history when deciding whether to approve your application.
Private loans for independent students will carry higher interest rates than both federal loans and private loans with a co-signer. Compare offers from multiple lenders to get the best rate.
How to Take Out Parent PLUS Loans (Even If You Have Poor Credit)
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Finding student loans for parents with bad credit can be challenging, especially if you want to borrow from a private lender. However, even with a subpar credit history, you may be able to get a federal parent PLUS loan from the government.
The parent PLUS loan only requires that you don’t have “adverse credit,” and its definition for adverse credit isn’t as strict as that for a private lender. What’s more, there are a few workarounds if you don’t meet the parent PLUS loan credit score requirements.
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To learn how to solve a parent student loan credit dilemma, let’s look at the following topics:
- Why getting student loans for parents with bad credit can be tough
- 4 steps to consider if your application was denied
- More tips to finding student loans for parents with bad credit
Why getting student loans for parents with bad credit can be tough
With a fixed interest rate of 5.30% APR (for the 2020-2021 school year), parent PLUS loans can be a more affordable option than private loans. But unlike Direct Subsidized Loans and other forms of federal student loans, parent PLUS loans require a credit check.
If you have an adverse credit history, the government could deny your application. The Federal Student Aid office considers you to have an adverse credit history if you meet one of the following conditions:
- You have debt with an outstanding balance greater than $2,085 that’s delinquent by 90 or more days.
- During the past five years, you’ve been subject to a default determination; discharge of debt in bankruptcy; foreclosure; repossession; tax lien; wage garnishment; or write-off of federal student aid debt.
Student loans for parents with bad credit can be tough to come by, because if you have any of those items on your credit report, you’ll likely be unable to qualify for a parent PLUS loan.
4 steps to consider if your application was denied
If you can’t meet the parent PLUS loan credit score requirements, there are other ways to get the money you need. These four alternatives can help you find funding:
1. Apply with an endorser
2. Provide documentation of extenuating circumstances
3. Help your child apply for Direct Unsubsidized Loans
4. Look for other funding sources
1. Apply with an endorser
Even with poor credit, you might be able to qualify for a parent PLUS loan if you apply with an endorser. An endorser acts as a guarantor on the loan. The endorser, usually a relative or friend with good credit and a stable income, is responsible for the loan if you fall behind on your payments.
Having an endorser lowers the risk for the lender, so the government is more likely to issue you a loan than if you applied on your own.
2. Provide documentation of extenuating circumstances
In some cases, your adverse credit history can be the result of extenuating circumstances. If that’s the case and you’re now back on your feet, you might be able to get a parent PLUS loan by filing an appeal with the Department of Education.
If you apply and are denied based on your credit history, you’ll receive a notification on how to appeal the decision and submit documentation of extenuating circumstances. You’ll also be required to complete PLUS loan counseling.
3. Help your child apply for Direct Unsubsidized Loans
If you cannot qualify for parent PLUS loans because you have an adverse credit history, your child might be able to take out more Direct Unsubsidized Loans to fill the gap. Direct Unsubsidized Loans, where your child is responsible for all interest that accrues on the loan, have a fixed interest rate of 2.75% APR (for the 2020-2021 school year) and can be a cost-effective borrowing option.
Contact your child’s school to discuss your financial aid options and to see if additional Direct Unsubsidized Loans are available.
4. Look for other funding sources
If you have poor credit, taking out private student loans probably isn’t an option. You’re unlikely to be approved without a creditworthy cosigner. Even if you’re approved, you might get much higher interest rates than you would with federal loans.
Instead, another way to support your child is by helping them find and apply for grants and scholarships. Your child can combine multiple scholarships and grants to reduce their college costs and limit their need for student loans.
Use our guide to state financial aid grants to find money for your child’s education.
Your child can also use the tips in our all-inclusive guide to college scholarships for high school seniors to find financial aid.
More tips to finding student loans for parents with bad credit
If you have poor credit, it might be impossible to get a parent PLUS loan on your own. But there are tools to help you build credit if you’re having trouble. In the interim, applying with an endorser or submitting documentation of extenuating circumstances might help you qualify for a federal loan.
If your application for a PLUS loan is still denied, don’t be discouraged. You can still help your child achieve their education goals. For more ideas, here’s how you can help your child pay for college without spending a cent.
In conclusion, you can get student loans without your parents. However, there are a few things to be aware of:
-If you’re under 18, your parent or guardian will have to cosign the loan.
-You’ll need to show financial need in order to qualify for subsidized federal loans.
-Private loans generally require a co-signer, but some lenders offer scholarships and other options for students who aren’t able to pay their full tuition costs.
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