How to Get a Student Loan With No or Bad Credit

Bad credit or no credit doesn’t have to be an obstacle to getting a higher education. There are ways to get student loans regardless of your credit history. For example, the federal government doesn’t factor in credit history when approving undergraduate student loans. You can get federal student loans with no credit or bad credit.

If you need additional funding, there are ways to get private student loans with no credit.


Here are some tips for what you can do to make sure your dreams don’t get squashed by your credit score.

5 ways to get student loans with bad credit or no credit

A student holding their wallet with a ten dollar bill sticking out of it.

1. Take advantage of federal student loans first

Federal student loans should always be your first option when you’re looking for financial aid for college. These loans are financed by the US Department of Education and come with several advantages.

The first advantage is that they don’t require a credit check. You can qualify for federal student loans with bad credit or no credit history at all. Because the federal government backs and insures these loans, they don’t require any specific credit criteria. They are available to all students who are enrolled at an accredited college or university, which is the main qualifying criterion for federal student loans.

Another advantage of federal student loans is they have lower interest rates as compared to any other type of loan. They also offer more flexible repayment plans and forgiveness under certain programs.

Students receive between $5,500 and $12,500 per year in direct subsidized and unsubsidized loans for undergraduate degrees and up to $20,500 per year toward a graduate degree.

Students with demonstrated financial need may also be eligible to receive additional funds through the Federal Perkins loan program. This program offers an additional $5,500 per year for undergrads and $8,000 per year for grad students.

Only the Federal PLUS loan program for independent students, graduate students, and parents of dependent undergrads require a credit check. However, the credit requirements are less stringent than those used by most private lenders. (The PLUS website states that borrowers must have “no adverse credit history,” which may make them a good option for students with little or no credit, but no derogatory marks.)

Sallie Mae logo.

3 Repayment Options

Variable rates from 5.37% - 15.70% APR with auto-debit

Learn More

2. Research loans with local/regional banks and credit unions

If the federal financial aid you’ve received isn’t enough to fund your education, you’ll need to apply for private student loans. This is completely different from applying for federal student loans. Private lenders base their lending decisions on various factors. The biggest factor is your credit history.

It can be incredibly difficult to get a private student loan with no or bad credit from large financial institutions. Most large banks and student loan lenders have very strict underwriting criteria. The criteria dictate who qualifies for a loan, what rates they receive, and how much they can borrow.

Local and regional credit unions also have underwriting guidelines that they use when issuing loans. But they are generally more flexible to meet the needs of their community and its members.

Getting student loans through credit unions may benefit you if you have limited or bad credit history. You may be able to qualify for a loan through one of these smaller lenders instead.

The website LendKey is an incredibly useful free resource, which can help you find and compare not-for-profit lenders that offer student loans in your area. It can save you the time and hassle of going to each bank or credit union separately to learn about their available loans.

3. Find lenders that do alternative credit checks

When looking for student loans for bad credit, consider researching lenders that offer alternative credit checks.

An increasing number of new lenders–especially those that operate only online–are setting up new and innovative ways to determine creditworthiness.

These lenders will still evaluate your credit history. However, they are likely to consider in a broader range of factors–like academic performance, future job prospects, and other measures–when making lending decisions.

One such lender is Earnest, an industry leader in student loan refinance that now offers in-school loans.

4. Apply for student loans with a cosigner

Applying with a creditworthy cosigner can help when if your credit score is less than perfect. Credit history is the most important factor that private lenders consider before approving any loan application.

Your chances of getting a private student loan with bad or no credit are very low. The few lenders who do approve your application will almost certainly charge you a higher interest rate.

The only way to get a low-cost private student loan is by applying with a creditworthy cosigner. A creditworthy cosigner is someone who meets the lender’s eligibility criteria. A co-signer could be a parent, grandparent, or even a friend who meets the lending requirements.

It’s important to consider this option carefully and take the obligation very seriously. Anyone who cosigns for your student loan will be equally liable for your debt as you are. If you miss a payment, it will get reported to both credit reports. Your credit score as well as your cosigner’s credit score will get damaged. Worst of all, the lender will try and collect the outstanding from your cosigner.

Be sure that you can and will repay your loans before asking anyone to cosign and possibly risking their credit and your relationship.

5. Appeal the decision

Well, that may not necessarily be the last word. Some lenders will approve or deny credit through an automated review process. They may allow you to appeal or request a manual consideration by one of their loan specialists.

This option may be a long shot. There aren’t very good statistics on how often it’s successful. But, if your back is up against the wall and you need the funding to finance your education, it can’t hurt to ask.

Use College Raptor’s free Student Loan Finder to compare lenders and interest rates side by side!


Lender Rates (APR) Eligibility
Citizens logo.
5.99%-16.61%* Variable
4.24%-15.61%* Fixed
Undergraduate and Graduate
Sallie Mae logo.
5.37% - 15.70% Variable
4.15% - 15.49% Fixed
Undergraduate and Graduate
Credibe company logo.
5.37% - 17.99% Variable
3.79% - 17.99% Fixed
Undergraduate and Graduate
Lendkey company logo.
5.98% - 13.74% Variable
3.99% - 12.61% Fixed
Undergraduate and Graduate
Ascent company logo.
5.99% - 15.85% Variable
3.79% - 15.41% Fixed
Undergraduate and Graduate
6.54% - 11.08% Variable
3.70% - 8.24% Fixed
Undergraduate and Graduate
Earnest company logo.
5.62% - 16.85% Variable
4.17% - 16.49% Fixed
Undergraduate and Graduate
6.00% - 14.22% Variable
4.50% - 14.22% Fixed
Undergraduate and Graduate
College Raptor is not a loan lender and does not assume responsibility for suggesting a loan to a user who may not be eligible for it. Rates, terms, conditions, eligibility, approval, and other considerations are the decisions of the lenders and may vary depending on which lender or marketplace the user selects. We urge users to carefully consider and review all loan options and terms before committing to taking out a loan.

7 thoughts on “How to Get a Student Loan With No or Bad Credit”

  1. Drew says:

    Great advice to ask around about different opportunities. You are exactly right about most people not realizing what money is waiting for them.

  2. John Ferrell says:

    I like that you said that we need to take it seriously. If you don’t take a loan seriously then you might end out in more trouble than you are in if you have a bad credit score. When my sister got a loan, she was having trouble with her credit score; she ended out paying all of the payments online because she made a budget. Speaking with a professional might help you to know what will help you and what won’t.

  3. John Mahoney says:

    I liked when you talked about using local lender when looking for a loan. It makes sense that doing this can help you get a great deal and be able to get the best payment options. I can see how anyone looking into this would want to make sure they consult with several companies and compare their services before they choose one.

  4. Scott says:

    I appreciate that you suggest find a cosigner to help secure a loan. I can understand why this would be a good option so that you don’t have to pay a lot more due to having bad credit. I remember that I did this when I bought my first car. After a year or so I was able to earn enough credit and remove my parents from the loan.

  5. John Mahoney says:

    Thank you for talking about the importance of making sure you do your research with several banks before shooting one to get a loan with. It makes sense that doing this can help you make sure you get the best rates you can from a place that is reputable. My son is looking for a loan so he can finish school so I’ll make sure he reads your article.

  6. Max Jones says:

    I like how you talked about being able to find lenders that do alternative credit evaluation. I’ve been working on improving my credit evaluation, and I think I’m close but I’m not quite there. I was hoping my car would last me until I could get it up more, but it didn’t, so I need to go and get a loan which means a credit evaluation! Hopefully I can find somewhere that can do an alternative credit check!

  7. Thanks for the tip about looking for smaller lenders because you might qualify for them in a way you wouldn’t with larger lenders. I’m going to be starting college next year, and my parents can’t afford to help me much. Maybe I should look for small loan businesses that offer no-credit financing in my area.

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