Everyone, regardless of credit, can
get help paying for college, but if you do have bad credit, you'll have
to mainly focus on loans that won't penalize you for your blemished credit score. Luckily, finding bad credit student loans that won't unfairly penalize you or
charge you lots of extra money is easy.
How to Apply for Bad Credit Student Loans
The first place you need to check for bad credit student loans is the federal government. The US Federal Government, through the Department of Education, offers numerous student aid programs that don't require you to have good credit. All you have to do to apply is fill out the Free Application for Federal Student aid, known as the FAFSA. That application doesn't even look at any of your credit information, so it doesn't matter if you have bad credit. The fastest and easiest way to complete and submit the FAFSA is to do it online. Just visit www.fafsa.ed.gov to find complete instructions as well as an application. That one application applies you for all the student aid programs offered by the federal government. Finding bad credit student loans couldn't be easier.
Types of Bad Credit Student Loans
Once your FAFSA has been processed by the Department of Education and the schools you are applying to, you will receive an Award Package detailing all the student loans, grants, scholarships and work study programs you are eligible for. Below is a list of the possible loans you might find, and all are great bad credit student loans.
- Federal Perkins Loan Program: The best bad credit student loans you can get are Perkins loans because they have the lowest interest rates and best terms. However, Perkins loans are only given out on a need basis, so not all students will be eligible ("Campus-Based Aid").
- Stafford Student Loans: Most students end up with a Stafford loan. There are two types of Stafford loans, Direct Stafford loans and FFEL Stafford loans. The main difference between the two is that for the Direct loans the government is the lender, while for FFEL loans private lenders such as banks and credit unions are your lenders. The private lenders have just agreed to participate in the government regulated loan program ("Stafford Loans"). Both FFEL Stafford loans and Direct Stafford loans come in two varieties, subsidized or unsubsidized. Subsidized loans do not require you to pay back any interest, and they are given out on a need basis. Unsubsidized loans, on the other hand, require interest payments, but anyone can get them regardless of need ("Stafford Loans").
Other Options for Bad Credit Student Loans
If the loans you get from the government aren't enough for you to afford a college education, you do have other options for bad credit student loans, but they are going to be harder to get and more expensive. Your second best option is to have one of your parents apply for a PLUS loan. A PLUS loan is a federal loan program designed to help parents pay for their child's college education ("PLUS Loans"). Your parent will have to fill out an application from your schools financial aid office and submit it to either your school or a lender, depending on what your particular school requires. Although a lender won't be checking your credit, they will be checking your parent's ("PLUS Loans"). So, if your parents have bad credit, you will have a very difficult time getting a loan and an even harder time getting really good rates and terms.
Your next option for bad credit student loans is to look to private lenders. Private lenders will check your credit before giving you a loan. So, if you have bad credit you will have a difficult time finding a loan and an even harder time getting good interest rates and terms. But, if you really need the money, you'll probably be able to find a lender. Just be prepared to pay high interest rates and fees.
Ultimately, your best option for bad credit student loans will be to apply to the federal government. Because they don't check your credit, you won't have any trouble getting bad credit student loans. However, if you need to pursue other options for bad credit student loans, be prepared to pay high interest rates and fees.