All lenders search for borrowers with very low risk. Banks and financial institutions want customers that they can be confident with! If you have a very poor financial background or an unstable source of income, lenders will classify you as risky. Even if you are the world’s most responsible person, lenders may not help you if you have a very poor financial track record. This is when cosigners come into play. Cosigner is a third party (can be an individual or company), who guarantees that the student loan will be reimbursed without any problems. There are plenty of ways by which you can get a student loan without a cosigner.
Method #1 – High Credit Score
One of the simplest ways to receive a private student loan without the help of a cosigner is to have a high credit score. You should have a credit score of at least 650 to qualify for the loan. Unfortunately, most college students have a score between 500 and 580. Such candidates will find the process of qualifying for a student loan without a cosigner difficult and tacky.
Method #2 – Ask For Help
If you want to borrow a student loan without a cosigner, you must improve your credit score carefully. In case your parents are financially stable, ask them to make you an authorized user of their bank accounts. This is also known as piggybacking. Generally, piggybacking will boost your credit score and increase your chances of getting a loan. Secondly, get hold of a credit card and make timely payments. This is a simple method that will boost your credit score in six short months.
Method #3 – Part Time Jobs
Do you know that part time jobs will increase your chances of bagging a student loan without a cosigner? If you have a steady source of income, lenders will be attracted towards you! However, if you jump between jobs and stay unemployed for a very long time, you will seem less worthy for a student loan! So, work towards bigger grades and better jobs for a successful loan application process. If the lender considers you as dependable, you will definitely improve your chances of receiving a student loan.
Method #4 – Using Assets
Moving on, you can get student loan without a cosigner, if you have a valuable asset like a self owned-vehicle or equity in a property. Nevertheless, think twice before you sign the lien rights to the lender. This is because you will lose your asset, if you are not able to reimburse the student loan on time!
Getting a student loan without a cosigner has many benefits but also many drawbacks. As potential borrower, you must weigh the pros and cons, before making a decision. If you have a cosigner, with a credit score better than yours, the loan application will be processed and approved quickly. Thus, you don’t need to worry about funds before entering college. On the other hand, finding a cosigner, who would take charge of your debts, is easier said than done!