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College Loans – No Cosigner

Receiving a college education may be the single most important accomplishment that one may achieve in their entire life time.

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For often low or no credit possessing college students, college loans – no cosigner seem like an impossible lending equation given traditional financial lending practices, however since the Higher Education Act of 1965, the federal government affords students lacking solid credit ratings and history financial aid and loans through two separate lending entities. The two lending programs, the FFELP and the FDSLP, are overseen by the Department of Education. For students seeking college loans no cosigner, the FDSLP, or Federal Direct Student Loan Program, offers two different undergraduate loans and one graduate student loan, of which none requires a cosigner or credit assessment for that matter. Students attempting to enter the real world truly should stop and consider the most basic, as well as the ulterior, benefits of college loans no cosigner.

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Reasons why individual’s parents may not wish to cosign student loans include:

• Debt obligations are shared equally by borrower and cosigner
• Creditors can pursue both borrower and cosigner
• Increases of personal debt-to-income ratio
• Detrimentally influences credit rating even without defaults or late payments
• Cosigners do not directly manage loan repayments

The most obvious benefit of college loans – no cosigner is garnering the financial support necessary to attend college. Without students’ drive to achieve in life through higher education, the student loan industry would not exist. In the same regards, lenders reciprocate to students’ sentiments through offering perquisites and other benefits within their loan programs. The United States Federal Government has taken on the undergoing of essentially regulating loans through their FFELP and FDSLP below market interest rates, extended and flexible repayment periods, graduation “grace” periods, and ease of accessibility to these loans. Also ennobling student borrowers, the FDSLP and FFELP disperse student loan awards on a necessity-basis stemming from information provided by students and their parents in the standardized FAFSA form. Some FFELP loans require cosigners as these loans are outsourced, albeit still 97% insured, by the federal government to affiliated private lending institutions such as Sallie Mae, Wells Fargo, JP Morgan Chase, and Citibank just to name a few. FDSLP loans come “directly” from the government without any cosigner requirement. This proves beneficial to students whose parents possess poor credit ratings or those students whose parents oppose cosigning loans.

In taking a loan out without a cosigner, students can also realize some of the ulterior benefits of student loan programs. If students repay loan promptly and in full, students will quickly accrue beneficial credit scores and thus stronger credit ratings. Students can use their newly acquired credit to finance mortgages, obtain car loans, start businesses, or consolidate other debts into one lower interest rate loan. In addition, students avoid the socially uncomfortable risk of being a financial liability to their cosigner. Although this may seem trivial prior to the loan, keep in mind the onus of the financial burden falls on the cosigner if the all else fails.

Private lending institutions offer a number of options for students to pursue student loans. Some benefits of student loans from private lending institutions unaffiliated with the Department of Education are the lack of strict deadlines seen within the federal loan application and acceptance process. In addition, private lenders offer loan amounts covering the full cost of attending school such personal expenses, transportation, and other school supplies, while the best federal loans only cover tuition, room, board, and very rarely, offer a meager stipend. With private lenders, students do not need to worry about these items and can focus on their academic endeavors instead of crunching personal finance numbers throughout the semester.

Do you need college loans – no cosigner?
Apply for college loans – no cosigner today.