Get A Handle On Your Current Loan Situation
The first step is to find out what types of loans you have. This will dictate your next steps.
The easiest way to do this is by logging into the Department of Educations Federal Student Aid website. Here, youll be able to see all of your federal loan details. If you need guidance regarding which loans currently qualify for PSLF, and what to do if they dont, you can use the PSLF Help Tool, which has been updated to reflect the criteria outlined in the new waiver.
If you dont already have an account set up with the Department of Education, youll need to do that first. Keep in mind that youll need your most recent W-2 or your employers Federal Employer Identification Number , and you must complete the process in a single session. It should take less than 30 minutes.
How To Apply For A Loan With Ascent
Borrowers can apply for an Ascent student loan entirely online. The application process takes about five minutes if you have all of your information handy. Heres what the process looks like when applying for a loan through Ascent:
Sallie Mae: Best For Multiple Loan Options
Overview: Of all the lenders on this list, Sallie Mae offers the most extensive menu of private student loan options. There are loans for students seeking undergraduate, graduate, medical, dental and law degrees, plus career-training loans, parent loans and even loans for people who pay tuition for K12 school.
Perks: Sallie Mae supports students through free study help and college expense calculators, and borrowers can take out loans even if theyre enrolled less than half time, attending online or summer classes, studying abroad or enrolled in professional certification courses.
What to watch out for: If you need to apply for hardship programs, Sallie Mae offers fewer options and shorter forbearance periods than others on this list.
|Late fee: 5% or $25 Returned check fee: Up to $20|
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Commonbond: Best Student Loan For Established Borrowers
Reasons to avoid
CommonBond student loans are some of the most competitive in the market thanks to its generous policies in the areas of repayment and forbearance. Its Social Promise – the company’s pledge to help provide schools, teachers, and technology to students in the developing world – can attract more socially-conscious students who are looking to make a difference by supporting companies working to better the world in one way or another.
Despite its good standing among other student loan providers, CommonBond has some major flaws that may automatically rule it out for some students who are either struggling or who are wary of experiencing financial hardship in the future. Younger students who have relatively little financial literacy or who are still learning financial responsibility may not feel comfortable opting for a lender that doesn’t offer the maximum amount of protections. We suggest that only more financially secure and established borrowers with excellent credit opt for CommonBond, which for them would still be one of the best student loans.
Other Private Lender Options For Student Loans For Bad Credit
Student Loan Hero recommends the three private lenders above because they keep their credit score requirements lower than competitors while still offering low interest rates. If you cant meet their credit criteria and are willing to stomach potentially higher rates, also consider:
- Chicago Student Loans by A.M. Money: Fixed interest rate loans awarded on merit, with federal loan-like option of income-based repayment
- Funding University: Fixed rate loans for undergraduates without cosigners
- MPower Financing: Fixed rate loans for DACA and international students without cosigners, collateral or credit history
Along with these lenders, you might also search for student loans from credit unions or even your college. Some lenders allow you to apply for a quick rate quote, so you can get a sense of preliminary offers before submitting a full application.
Just watch out for lenders that promise no credit checks whatsoever. Their loans could be tagged with hidden fees and, worse, extremely high interest rates.
By shopping around for federal and private student loans, you can find the loan with the most competitive rate, as well as flexible repayment terms and good customer service.
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Sallie Mae: Best Student Loan Overall
Reasons to buy
Reasons to avoid
Out of all the private lenders we reviewed, we think that Sallie Mae is the best – and most popular – student loan. Sallie Mae’s terms, rates, and borrower eligibility appeal to a broader range of students, from DACA students who need to cover the full cost of attending school to those looking for a relatively small financial aid award. Sallie Mae, like all private lenders, relies on credit reports to determine interest rates for their borrowers, which makes it a less appealing option than Federal Student Aid – however, it offers tremendous flexibility in terms of loan terms and amounts. Sallie Mae also has relatively clear-cut forbearance and hardship options compared to other lenders who may not want to encourage borrowers to defer payments. The information put forth by Sallie Mae can make students feel more comfortable opting for a lender with set policies that protect the borrower, and not just a lender.
How Much Can You Get In Private Student Loans
Private student loan lenders, generally, will not let you borrow money in excess of your school’s cost of attendance. Your school will let you know the maximum loan amounts you can borrow in a private student loan, which will be determined by subtracting all the aid you have been awarded/accepted from your total cost of attendance.
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Are Private Student Loans Right For You
It can be hard to know if private student loans are right for you. Honestly… there is no right answer. Some people swear off private student loans. Other people have found them to be a helpful way to pay for college while saving money in interest.
It’s important to remember that Federal student loans come with a lot of options, and they usually have a very good interest rate. With Federal student loans, you get access to income-driven repayment plans, student loan forgiveness options, and more. You don’t get many benefits with private student loans.
However, private student loans typically give you the best student loan rates possible.
You might also consider an income-sharing agreement as an alternative to a private loan. Income-sharing agreements are where you get money for school in exchange for paying back a portion of your income after graduation. These plans are typically structured in a way that means you only pay back if you see a positive return on your education. Check out our guide to income-sharing agreements here.
As with everything related to paying for college, we recommend you follow the Proper Order Of Operations To Pay For College. Make sure you’ve exhausted your other aid, Federal student loans, and working before diving into private student loans. If you’re at that point already, then make sure you’re shopping around for the best student loan rates and terms.
Private Student Loans For Bad Credit
Although the government is a great source of student loans for bad credit, you might find yourself unable to cover the full cost of attendance.
If you still have a gap in funding, you could consider a private student loan. Private student loans get tricky, though, because they typically require at least decent credit.
Most private lenders run a credit check, where they consider your income, debt-to-income ratio and history of debt repayment.
Student loans for bad credit can be difficult to find. That said, you can apply with a creditworthy cosigner, such as a parent. According to data firm MeasureOne, 91% of undergraduate students apply for a private student loan with a cosigner.
|Have a cosigner joining your private loan application?|
If you dont have a cosigner, check out the following lenders that offer student loans for bad credit. These lenders do offer some of the most competitive terms and easiest application processes.
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Ascent Student Loans Disclosures
Ascent loans are funded by Bank of Lake Mills, Member FDIC. Loan products may not be available in certain jurisdictions. Certain restrictions, limitations and terms and conditions may apply. For Ascent Terms and Conditions please visit: AscentFunding.com/Ts& Cs.
Rates are effective as of 10/01/2021 and reflect an automatic payment discount of either 0.25% OR 1.00% . Automatic Payment Discount is available if the borrower is enrolled in automatic payments from their personal checking account and the amount is successfully withdrawn from the authorized bank account each month. For Ascent rates and repayment examples please visit: AscentFunding.com/Rates.
1% Cash Back Graduation Reward subject to terms and conditions, please visit AscentFunding.com/Cashback. Cosigned Credit-Based Loan student borrowers must meet certain minimum credit criteria. The minimum score required is subject to change and may depend on the credit score of your cosigner. Lowest APRs are available for the most creditworthy applicants and may require a cosigner.
Private Student Loan Interest Rates
Variable: 0.99% – 11.22%, Fixed: 2.99% – 10.66%
Variable: 1.09% – 11.33%, Fixed: 4.13% – 10.90%
Variable: 1.50% – 9.33%, Fixed: 3.15% – 11.48%
Variable: 1.51% 10.83%, Fixed: 3.21% 12.99%
Variable: 0.99% – 10.88%, Fixed: 2.99% – 12.18%
Variable: 0.99% – 9.89%, Fixed: 2.99% – 10.99%
Variable: 0.99% – 11.98%, Fixed: 2.99% – 12.94%
Variable: 1.99% – 10.97%, Fixed: 4.49% – 11.98%
Rates in this post are current as of 11/01/2021.
Undergraduate interest rate range: Variable: 0.99% – 11.22%, Fixed: 2.99% – 10.66%
Loan amounts available: $5,000 minimum, up to 100% cost of attendance
Repayment options available:
Deferred: No payments until six months after leaving school Interest only: Only make payments on the loan’s interest while in school Partial payments: Pay $25 per month while in school Full repayment immediately: Start making full payments while still in school
SoFi’s private student loans are best for graduate students. SoFi is one of the few lenders that offers lower interest rates for graduate school loans than undergraduate loans, with graduate loans starting 0.1% lower than undergraduate loans.
While SoFi’s interest rates are competitive with others on the list, what makes SoFi unique are its other features. This lender offers some good protections for student loan borrowers, like career services and unemployment protection. Additionally, SoFi’s student loans have no fees, including no late fees .
Repayment options available:
Repayment options available:
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Student Loans For Bad Credit: Federal And Private
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Editorial Note: This content is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the authors alone, and may not have been reviewed, approved or otherwise endorsed by the financial institution.
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What If My Grants And Federal Loans Don’t Cover The Cost Of Attendance
If your grants and federal loans are not enough to cover the cost of your education, you should consider the following options:
- and scholarships using one of the many free scholarship search options available. Servicemembers, veterans, and their families may be eligible for GI Bill benefits and/or military tuition assistance.
- Cut costs. Consider getting one or more roommates or a part-time job, possibly through Federal Work-Study.
- See what your family can contribute. Your parents may be able to get tax credits for their contributions. Parents can also explore the federal Direct PLUS Loan program.
- Shop around for a private loan. Remember that these loans generally have higher interest rates and less repayment flexibility compared to federal student loans. You generally should turn to private loans only after you have explored all other grant, scholarship, and federal loan options. If you can show you have a very high credit rating, you may find an affordable private student loan, though you will likely need a co-signer, who will be legally obligated to repay the loan if you can’t or don’t. Look for the one with the lowest interest rate and flexible repayment options.
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We believe everyone should be able to make financial decisions with confidence. And while our site doesnt feature every company or financial product available on the market, were proud that the guidance we offer, the information we provide and the tools we create are objective, independent, straightforward and free.
So how do we make money? Our partners compensate us. This may influence which products we review and write about , but it in no way affects our recommendations or advice, which are grounded in thousands of hours of research. Our partners cannot pay us to guarantee favorable reviews of their products or services.Here is a list of our partners.
Interest Rates And Terms
Borrowers with credit-based loans can get a 0.25 percent interest rate discount after setting up automatic payments. That discount rises to 2 percent if you take out a loan based on your future income and set up autopay. Below are Ascents interest rates by loan type. All rates include an automatic payment discount.
|3.21% to 12.99% APR|
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How Does Refinancing Affect My Credit
When you refinance your student loan, lenders will pull your report to determine if you’re a risky borrower, which is considered a hard inquiry. This may lower your credit score by five or so points, but it’s likely to go back up as you continue to make on-time monthly payments on your new refinanced loan.
Many lenders as well as loan marketplaces offer prequalification tools where you can quickly input your personal information and see rate quotes from lenders without actually applying and affecting your credit. You’ll be able to get an idea of your interest rate, repayment term and any fees. Choose the lender that offers you an interest rate considerably lower than the one you currently pay.
Sofi: Best For Online Borrower Resources
Overview: SoFi offers undergraduate student loans, law school loans, medical school loans, MBA loans and parent loans, plus other financial products such as personal loans and mortgages.
Perks: With SoFis unemployment protection program, a professional can help you search for jobs and provide one-on-one career training. And unlike many other student loan lenders, SoFi has an app where you can browse deals, use financial planning tools and find educational resources.
What to watch out for: SoFis minimum loan amounts are higher than those of any other lender on this list, which might not be a good fit for people who only need to borrow a small amount.
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What Is A Private Student Loan
A private student loan is a non-federal student loan used to help pay for college related expenses.
Essentially, private student loans are a way to help pay for school when you dont have enough federal financial aid, scholarships, and out-of-pocket money. Its pretty much that simple. Some colleges and universities will say things like, they help cover the gap.
Sallie MaeLearn More About Sallie Mae
Looking For Ways To Pay For College
In the end, paying for college is about assembling your resources. If you have time, you can save up using something like a 529 plan to reduce your need for student loans. You can also work part time during school or apply to be a resident advisor in exchange for the free housing.
Student loans are only part of the puzzle when it comes to paying for your higher education. They are an important part, but they arent the only part.
Review your options and get creative. If you can avoid getting student loans, or reduce what you borrow, your credit becomes less important and you can avoid some of the interest costs that come with loans.
One great way to reduce the amount of student loans you need to borrow is to apply for grants and scholarships.
Rebecca Safier contributed to this report.
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