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Some private lenders offer student loans without a cosigner. But they often require you to have good credit and a solid income. (iStock)
If you’re an undergraduate student, a student loan may be the first type of loan you apply for. Private lenders typically consider your income and credit to assess whether you can repay your loan — two things you might be short on. So what should you do if you’re missing those key factors? You can apply with a cosigner to increase your approval odds and possibly get a lower interest rate.
But don’t worry if you can’t find a cosigner — most federal student loans don’t require one. However, if you max out your federal student loan limit, your only option may be to take out a private student loan without a cosigner.
Can I get a student loan without a cosigner?
A cosigner is a person who agrees to repay a loan if you don’t make your payments — anyone who meets a lender's eligibility requirements can cosign a student loan for you. When you apply for a student loan, you have two options: private and federal.
Private student loans are offered by private institutions and aren’t backed by the federal government. Although most private student loan lenders require a cosigner, some give loans to people without a cosigner if they meet certain requirements. In addition, most lenders give you the option to release or remove a cosigner after you’ve made a certain number of on-time payments.
With Credible, you can easily compare rates on private student loans.
Federal student loans are provided by the U.S. Department of Education. When you apply for a federal student loan, you likely won’t need a cosigner — all federal loans are available without one. But when you apply for a Direct PLUS Loan, you may need an endorser (which is similar to a cosigner) if you have poor credit. Like a cosigner, an endorser agrees to repay your loan if you can’t.
Federal student loans that don’t require a cosigner
There are four types of federal student loans that you can get by first filling out the Free Application for Federal Student Aid, or FAFSA. Most of them don’t require a credit check, so having minimal or bad credit won’t prevent you from qualifying.
- Direct Subsidized Loans: Undergraduates who meet certain income requirements may qualify for this federal loan. While you’re in school, the federal government pays the interest on your loan. Your school determines the amount you can borrow based on your financial need. Undergraduate students can borrow a maximum of $5,500 to $12,500 in Direct Subsidized Loans and Direct Unsubsidized Loans (the actual number depends on your dependency status and year in school).
- Direct Unsubsidized Loans: Undergraduate, graduate, and professional students may qualify for this type of student loan. Unlike Direct Subsidized loans, your eligibility isn’t tied to your financial need. Your loan amount is also determined by the school and depends on the cost of attendance and any amount of federal student aid or scholarships you receive. Graduate or professional students can take out up to $20,500 in Direct Unsubsidized Loans per year.
- Direct PLUS Loans: Direct PLUS Loans are designed for graduate and professional students. Parents can take out a Parent PLUS Loan for their undergraduate dependents. Unlike the loans mentioned above, a credit check is required. The amount you can borrow also depends on your school’s cost of attendance and the amount of federal student aid and scholarships you receive.
- Direct Consolidation Loans: If you have more than one federal loan and prefer a single monthly payment, you can merge them into one loan by taking out a Direct Consolidation Loan.
Although your maximum loan amount varies, federal student loans do come with lifetime loan limits. Dependent undergraduate students are allowed to borrow up to $31,000. If you’re an independent undergraduate, you can borrow more money — up to $57,500. Graduate or professional students can borrow up to $138,500.
Private student loans without a cosigner: What to know
Since most private student loan lenders require a cosigner, it may be difficult for you to get a private loan if you don’t have one. To qualify for a private loan without a cosigner, you’ll likely need a good to excellent credit score (at least 670) and must meet any income requirements set by the lender.
If you have bad credit or minimal credit history, applying with a cosigner could help you qualify and possibly get a lower interest rate.
6 lenders that offer private student loans without a cosigner
When you take out a student loan without a cosigner from a private student loan lender, you’ll likely encounter higher income and credit score requirements.
To get the best deal, use an online marketplace like Credible to compare private student loan rates from multiple lenders.
You can start your research by reviewing these six private lenders that offer non-cosigner loans.
Ascent offers its Ascent Non-Cosigned Credit-Based and Non-Cosigned Future-Income Based Loans without fees that are based on your credit or future income. Since the lender only requires a 600 credit score, you might qualify without a cosigner. Ascent is a Credible partner.
- Minimum income requirement: None
- Minimum credit score: 600
- Loan terms: Five, seven, 10, 12, 15, or 20 years
- Loan amounts: $1,000 to $200,000
If you live in Indiana or plan on attending a school there, INvestEd offers loans without cosigners. To qualify, you’ll need a good credit score (670 or above). INvestEd is a Credible partner.
- Minimum income requirement: $3,333 a month or a debt-to-income ratio of 30% or lower
- Minimum credit score: 670
- Loan terms: Five, 10, or 15 years
- Loan amounts: $1,001 to 100% of the cost of attendance (minus other financial aid)
Lendingtree is an online marketplace that matches students with lenders. You can use its website to compare student loans from multiple lenders, including Sallie Mae and SoFi. LendingTree is not a Credible partner.
- Minimum income requirement: Varies
- Minimum credit score: Depends on partner lender
- Loan terms: Depends on lender
- Loan amounts: Varies
MEFA could be a good option if you have at least a 670 credit score and meet the lender’s minimum income requirement. MEFA is a Credible partner.
- Minimum income requirement: $25,750
- Minimum credit score: 670
- Loan terms: 10 or 15 years (undergraduates), 15 years (grad students)
- Loan amounts: $1,500 up to the cost of attendance (minus other financial aid)
Nearly 88% of Sallie Mae’s undergraduate loans are cosigned, but you may qualify without a cosigner if you meet its lending requirements. Unfortunately, Sallie Mae doesn’t disclose its income and credit score requirements. Sallie Mae is a Credible partner.
- Minimum income requirement: Not disclosed
- Minimum credit score: Not disclosed
- Loan terms: Five to 15 years (undergraduate loans)
- Loan amounts: $1,000 up to your school’s cost of attendance
You don’t need a cosigner to apply for SoFi’s student loans, but the lender encourages it if you have minimal credit history. SoFi is a Credible partner.
- Minimum income requirement: Not disclosed
- Minimum credit score: Not disclosed
- Loan terms: Five, seven, 10, or 15 years
- Loan amounts: $5,000 up to your school’s cost of attendance (minimum may be higher depending on the state you live in)
How to improve your chances of getting a student loan without a cosigner
If you’ve decided that a non-cosigner private loan is your best option, follow these four steps to improve your chances of getting one.
- Exhaust your federal loan options first. Before you apply for a private student loan, max out your federal student loan options. Since those types of student loans come with federal protections and flexible repayment options, they may be better for some borrowers.
- Build credit history. You can build your credit history by paying your bills on time, including any loans or credit cards you may have. If you don’t have a credit account, consider taking out a credit-builder loan to establish credit history. Alternatively, you could ask someone who has good credit and a lengthy payment history to add you as an authorized user on one of their credit cards.
- Improve your credit score. To improve your credit score, focus on these key credit factors — payment history and the amount of debt you owe — combined, they account for 65% of your FICO score. Paying down your debt and paying off your credit accounts on time can have a positive impact on your score over time.
- Boost your income. If you have spare time, try picking up a part-time job or side hustle. Working while you’re in school can be tough, but it can help you meet a lender’s income requirements.
Pros and cons of non-cosigner private student loans
Although some lenders offer private student loans without a cosigner, consider the pros and cons before applying for one.
- May get a lower interest rate — Since your interest rate is based on your credit, you might receive a lower interest rate than you would with a federal student loan. With federal student loans, everyone receives the same fixed interest rate set by Congress, regardless of their credit history.
- Larger loan amount — If you need to borrow more than the federal student loan limit to pay for school, you might be able to take out a larger loan amount with a private lender.
- May come without fees — Federal student loans come with origination fees that reduce your loan amount. If you find a private student loan that doesn’t charge a loan fee, you can put more money toward paying your school expenses.
- Good credit required — If you don’t have good credit, you’ll have a hard time being approved for a student loan without a cosigner. And even if you’re approved, you likely won’t qualify for the best student loans, and you’ll probably get a higher interest rate.
- Limited repayment options — Unlike federal student loans, private student loans don’t come with income-based repayment plans. If your income drops, you might not be able to afford your monthly student loan payment.
- No student loan forgiveness programs — If you take out a private student loan, there are currently no forgiveness options. With federal student loans, you can enroll in the Public Service Loan Forgiveness program and receive forgiveness after making a certain number of payments.
When is it OK to get a student loan without a cosigner?
Whether it’s OK to get a student loan without a cosigner depends on your unique financial circumstances. That said, here’s when it might be OK to get one.
If you’re a graduate student, you may have enough income and a high enough credit score to qualify for a non-cosigner student loan. Or, you could be an undergraduate who has good credit and a decent income.
However, if you’re an undergraduate who depends on your parents and has minimal credit, applying with a cosigner can be a good idea. You’ll likely increase your approval odds and lower your rate by getting a cosigner. In addition, if you’re an older student who has a negative credit history, it may be better to apply for a student loan with a cosigner, if possible.
Check out Credible to compare rates from various private student loan lenders at once.