Credit History FAQ
Your Credit Rating and Your Options
Understanding what Credit actually means and knowing how good of a Credit Rating you have is a critical point in finding loans. Basically, the better your credit is, the better your loans could be. Everybody has questions when first learning about credit. Here are some Frequently Asked Questions and answers to help get you started.
My family can’t afford college tuition, so I need to apply for loans. What kind of financial aid and loans are out there for someone with no credit and no college savings, like me?
Let’s start by saying that if you need financial assistance you should search and apply for as many scholarships and grants as possible. These financial tools require no repayment. In short, scholarships and grants are FREE MONEY! Go after every one you can get your hands on. Be sure to fill out your Free Application for Federal Student Aid (FAFSA), as this is where are majority of student grants come from. This financial support comes directly from the government. You may qualify for federal grants, such as the Pell Grant, depending on your family’s income.
Another reason why scholarships and grants are so great, is that they require no credit check. So, if you are a soon-to-be college student with little to no credit, you don’t have to worry about not receiving funds- just be sure to keep those grades up!
If this is still not enough or you don’t qualify, then turning to loans is your next step.
I am trying to fund an MBA program, but I was not approved for an alternative student loan that I was hoping would cover the rest of my college costs that federal loans do not. What are my other options without proper credit?
MBA degrees are a hot commodity in the business world. Unfortunately, there are some students who aren’t able to afford them right after graduating with their bachelor’s degree. If you don’t qualify for alternative student loans, don’t fret too much. You may want to try and enter the business world, then come back and attain your MBA.
Companies recognize that many students can’t afford or simply forgo getting their MBA so they can focus on their careers. Many of these organizations often provide funding for their employees to go back and achieve their MBA. Some colleges and universities even offer an Executive Masters of Business Administration (EMBA) degree. EMBA’s don’t let just any graduate into the program. In order to be eligible to enroll, you must be in your profession for at least a few years. Until this time-frame is met, you won’t even be considered for acceptance into the EMBA program. Getting an EMBA will actually make you more respected in your boss’ eyes, and may even help you climb the corporate ladder even quicker!
My spouse and I have a child about to enter college. We need to apply for loans and have a decent credit score. What advice is there for us?
Different lenders require different credit scores. Many lenders are flexible with people looking for loans, but if you have bad credit you may have a difficult time receiving one. One of the first programs you should check out would be the Parent PLUS Loan. This is a loan borrowed by the parent on behalf of their child to pay for tuition and other school related expenses. These loans guarantee a low interest rate and can potentially cover the entire cost of your kid’s undergraduate study.
Another option would be to apply for a private loan from a student loan lender, such as a bank. They usually have higher standards on credit ratings, and often have higher interest rates. Only go through them as a last resort.
I was unable to complete my four-year degree, and I want to go back and earn it. I have bad credit and don’t want to ask family or friends to co-sign a loan. Are there any loans that I can get without going through a credit check?
There are more people than you know that are in the same situation as you. As having a college degree is becoming more and more important in the workplace, many are going back to college to gain a competitive advantage. Luckily, there are some funding options (scholarships and grants) that are available just because you are a non-traditional student. You can find financial aid based on student type or a specific field of study. You can even fill out the FAFSA to get some extra help from Uncle Sam!
I have a good credit score. Which loans should I apply for?
If you have good credit, you are probably eligible for almost every loan. The first step you should do (as is always the case) is apply for federal loans. They always have the lowest interest rates and provide a lot of funding. We have actually a whole page dedicated to federal loans and how to go about applying for them. Just about every loan we’ve already discussed is available to you. There are even some not yet mentioned, called Perkins Loans, where you can receive funding jointly by the government and the school you are attending. If you can, avoid private loans. These are always to be used as a last resort.
I have no Credit. What funding options are available to me?
Really, the only thing available would be scholarships and grants. But if this isn’t enough, there is only one thing you can do to get a loan with no credit: get a cosigner. Lenders always perform credit checks and will always require there to be somebody with income in case you default on your loans.
If I have no credit can I get a cosigner for my student loans?
Anybody can get a cosigner. Usually it is a parent, guardian, or friend that signs the loan with you. Just be sure that your cosigner has a good credit history, so that you can receive the best loan offer.