How to Get Student Loan without a Co-Signer?

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Higher education is a dream of many but without any financial help, it can prove to be very expensive. Hence, many students in the USA prefer taking loans. As per CNBC, about 12 million out of 20 million Americans who attend college take financial help to cover costs. There are various types of loans that one can take for higher education. Some require a co-signer while some don’t.

First, let’s understand who a co-signer is? Simply put, a co-signer is a person who is obligated to pay for your loan if you do not. It can be your parents. Most of the private lenders will require a co-signer or might give you a loan without a co-signer under some circumstance but the interest will be higher. The best way to get a student loan without a co-signer is by applying for federal loans. Direct PLUS loan is the only exception. Let’s get the basics right.

What are Federal Loans?

Federal loans are provided by the federal government. The rates of interest are decided by Congress each year. Federal loans are flexible along with other benefits like fixed interest rates, driven repayment options and deferment and forbearance. You can tie payments of the loan to your income or can even get your loan forgiven if you work in the public sector.

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Federal loans do not require you to have a co-signer or even good credit. Everyone who has a high school diploma is qualified to receive them; however, they are other eligibility criteria.

Who is Eligible for Federal Loans?

  • US nationals (including natives from Swains Island and American Samoa) 
  • The person needs to have the US green card
  • One must demonstrate financial needs
  • The person must have a high school diploma or GED certificate
  • One needs to be accepted as a student in an eligible degree or certificate program

If you correspond to any of the conditions given above, then you can fill out an FA-FSA that stands for Free Application for Federal Student Aid. There are some circumstances in which a student’s application can be rejected like a student with criminal records, students with intellectual disabilities, students who are in foster care, non-US citizens, students whose parent was killed in Iraq or Afghanistan.

There are various types of Federal Loans for those who are eligible.

Types of Federal Loans

Direct Subsidized Loans

This type of loan is given to undergraduate students with financial needs. The amount that one can borrow is determined by the school. In this case, the interest is paid by The U.S. Department of Education while you are in school at least half-time or during the grace period of six months or the period of deferment. This type of loan can be applied without a co-signer. 

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Direct Unsubsidized Loans

This type of loan is given to undergraduate and graduate students. It does not require you to show financial need. Your school will determine the amount you are eligible to borrow based on your cost of attendance and any other financial aid you might be receiving. In this case, you will be responsible for paying the interest during all periods. You don’t need a co-signer for this kind of loan. 

Direct PLUS loans (for graduate and professional students)

Direct PLUS loan given to parents is simply known as PLUS Loan and the one given to a grad is known as a Grad PLUS loan. The lender is the US Department of Education. Your credit history will be checked, so, make sure that it is not adverse. If you meet additional requirements, even adverse credit history is ignored in some cases. The maximum amount you can borrow will be determined by the cost of attendance minus other financial aid. If you apply for a Grad PLUS loan and the organization thinks that you won’t be able to repay, then they will ask for an endorser, who is similar to a co-signer. 

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For knowing the rest of the process and details, you can get in touch with your school. 

For international students who wish to study in the US, it can get difficult to get loans without a co-signer. However, some private organizations offer loans without a co-signer with several conditions. Every organization will have different conditions for eligibility. 

The USA is considered the land of opportunities and for the right reasons. It offers top-notch education and millions of students from all over the world want to study there. Education in the USA is expensive but education loans offered by the government and private organizations can help you in pursuing your dreams. 

Best Student Loans Without a Co-Signer

The list of best student loan without a co-signer is from Forbes

  • Federal Direct Subsidized Loans
  • Federal Direct Unsubsidized Loans
  • Ascent Undergraduate Future Income-Based Loan
  • Federal Graduate PLUS Loan
  • Ascent Undergraduate Non-Co-Signed Credit-Based Loan
  • A.M. Money
  • Funding U
  • Prodigy Finance