It’s not rocket science. The further you are in your academic career, the more financially independent you become.
That’s why just 60 percent of advanced-degree students have cosigners on their student loans. Compare that to 93 percent of undergraduate students who enjoy cosigner support, according to MeasureOne.
If you’re going to law school, seeking an MBA, or considering other professional degrees, you probably already exhausted your financial aid opportunities for an education.
In the interest of independence, you could now be considering student loans without cosigner help.
Federal student loans without cosigner requirements
There are two federal options that don’t require cosigners for graduate or professional students: Direct Unsubsidized Loans and Direct PLUS Loans. They do require filling out the FAFSA, however.
You’re allotted $20,500 in Direct Unsubsidized Loans to put toward your graduate or professional degree. Your combined limit for your undergraduate and graduate education is $138,500. (At most, $65,500 of that amount can be in Direct Subsidized Loans from your undergraduate degree.)
The average cost of a law degree at top-ranked schools is $60,293 per year, according to U.S. News. So you can see why you might need help beyond unsubsidized loans.
If you maximize your unsubsidized loan allotment during graduate school, you could then resort to a Direct PLUS Loan.
Like Direct Unsubsidized Loans, PLUS Loans don’t require a cosigner. But you would need to have better than an “adverse” credit history to qualify. That’s key among the facts to know before applying for PLUS Loans.
If your credit history fails to make the grade, you could find an “endorser,” which is the federal government’s equivalent of a cosigner.
But without a creditworthy cosigner, you might start considering your private student loan options.
How to get a private student loan without a cosigner
If you took out a private loan for your undergraduate degree, you’re already familiar with the process of applying for and securing a loan. You supply personal and financial information to lenders and shop around for the best possible interest rate and loan terms.
The key difference is that when you were an undergrad, you likely rode the coattails of a cosigner. Lenders consider credit history, debt-to-income ratio, and other factors when evaluating a borrower. Because you were likely a teenage or 20-something borrower without much of a credit history, your cosigner would have stood in for support.
Now that you have an undergraduate degree and possibly even some work experience, you might be able to secure a favorable loan from a private lender on your own. In fact, graduates are four times more likely than their younger peers to secure student loans without cosigner backing, according to Sallie Mae.
So if you were wondering how to get a private student loan without a cosigner, now you know it’s possible.
Some lenders even offer student loans without cosigner backing specific to your degree type. For example, Sallie Mae offers loans for students seeking an MBA or pursuing a health profession, to name a couple examples.
Compare your federal and private student loan options
If you’re focused on student loans without cosigner requirements, you can receive one from the federal government or a private lender. Knowing which lender is best is the real challenge.
Your interest rate is a good place to start. Via the federal government, you’ll find fixed interest rates. For loans disbursed before July 1, 2018, the rates are:
- Direct Unsubsidized Loans: 6.00%
- Direct PLUS Loans: 7.00%
The federal government also applies a fee on these loans. For loans disbursed before Oct. 1, 2018, that would be 1.066 percent for Direct Unsubsidized Loans and 4.264 percent for PLUS Loans. The fee is taken out from your loan amount, making it important to apply for the right amount of funds.
Many of our recommended private student loan companies don’t charge loan origination fees. They also start their fixed interest rates at or near 3.00%. But these rates could be as high as 12.00% or more, depending on your creditworthiness.
Aside from offering variable interest rates — rates that can change over the life of your loan — private lenders might be more appealing for other reasons.
If you’re a dental school student, for example, you might have off-campus expenses. A private lender like Citizens Bank lends as much as $295,000 to health profession students. By comparison, a Direct PLUS Loan would only cover the cost of your school’s attendance.
You should also compare your federal and private student loan options on another major front: repayment assistance. Even the best private lenders can’t match the federal government’s potential offer of loan forgiveness, for example. In fact, there are nationally- and state-funded loan repayment assistance programs for lawyers, doctors, and other health care professionals.
A final word on student loans without cosigner support
Being a graduate or professional student makes you independent in the eyes of the federal government. That status allows you to borrow more for your education than a dependent undergraduate. It’s one of many differences between undergraduate and graduate school loans.
But just because you could borrow from the government without a cosigner doesn’t mean you should do the same with a private lender.
If you find yourself Googling the words, “student loans without cosigner bad credit,” for example, you might be better off relying on your federal loan options or finding a good cosigner. For example, you can explore ways to find a cosigner when your parents aren’t options.
But you might still be prioritizing private student loans without a cosigner and no credit history required. In that case, ensure that you get the lowest possible interest rate by working on improving your credit first.
Need a student loan?Here are our top student loan lenders of 2018!
|1 Important Disclosures for CollegeAve.
College Ave Student Loans products are made available through either Firstrust Bank, member FDIC or Nationwide Bank, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.
Information advertised valid as of 11/1/2018. Variable interest rates may increase after consummation.
2 Important Disclosures for Discover.
3 Important Disclosures for Ascent.
Before taking out private student loans, you should explore and compare all financial aid alternatives, including grants, scholarships, and federal student loans and consider your future monthly payments and income. Applying with a cosigner may improve your chance of getting approved and could help you qualify for a lower interest rate. Ascent Student Loans may be funded by Richland State Bank (RSB). Ascent Student Loan products are subject to credit qualification, completion of a loan application, verification of application information and certification of loan amount by a participating school. Loan products may not be available in certain jurisdictions, and certain restrictions, limitations; and terms and conditions may apply. Ascent is a federally registered trademark of Turnstile Capital Management (TCM) and may be used by RSB under limited license. Richland State Bank is a federally registered service mark of Richland State Bank.
* Application times vary depending on the applicants ability to supply the necessary information for submission.
* The Sallie Mae partner referenced is not the creditor for these loans and is compensated by Sallie Mae for the referral of Smart Option Student Loan customers.
4 = Sallie Mae Disclaimer: Click here for important information. Terms, conditions and limitations apply.
5 Important Disclosures for PNC.
PNC Bank is one of the nation’s largest education loan providers. For over 40 years, PNC has been committed to helping students and their families make possible the adventure of college.
6 Important Disclosures for SunTrust.
Before applying for a private student loan, SunTrust recommends comparing all financial aid alternatives including grants, scholarships, and both federal and private student loans. To view and compare the available features of SunTrust private student loans, visit https://www.suntrust.com/loans/student-loans/private.
Certain restrictions and limitations may apply. SunTrust Bank reserves the right to change or discontinue this loan program without notice. Availability of all loan programs is subject to approval under the SunTrust credit policy and other criteria and may not be available in certain jurisdictions.
SunTrust Bank, Member FDIC. ©2018 SunTrust Banks, Inc. SUNTRUST, the SunTrust logo and Custom Choice Loan are trademarks of SunTrust Banks, Inc. All rights reserved.
7 Important Disclosures for LendKey.
Additional terms and conditions apply. For more details see LendKey
8 Important Disclosures for CommonBond.
A government loan is made according to rules set by the U.S. Department of Education. Government loans have fixed interest rates, meaning that the interest rate on a government loan will never go up or down.
Government loans also permit borrowers in financial trouble to use certain options, such as income-based repayment, which may help some borrowers. Depending on the type of loan that you have, the government may discharge your loan if you die or become permanently disabled.
Depending on what type of government loan that you have, you may be eligible for loan forgiveness in exchange for performing certain types of public service. If you are an active-duty service member and you obtained your government loan before you were called to active duty, you are entitled to interest rate and repayment benefits for your loan.
A private student loan is not a government loan and is not regulated by the Department of Education. A private student loan is instead regulated like other consumer loans under both state and federal law and by the terms of the promissory note with your lender.
If your private student loan has a fixed interest rate, then that rate will never go up or down. If your private student loan has a variable interest rate, then that rate will vary depending on an index rate disclosed in your application. If the interest rate on the new private student loan is less than the interest rate on your government loans, your payments will be less if you refinance.
If you don’t pay a private student loan as agreed, the lender can refer your loan to a collection agency or sue you for the unpaid amount.
Remember also that like government loans, most private loans cannot be discharged if you file bankruptcy unless you can demonstrate that repayment of the loan would cause you an undue hardship. In most bankruptcy courts, proving undue hardship is very difficult for most borrowers.
9 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|3.94% – 12.78%1||Undergraduate, Graduate, and Parents|
|4.06% – 13.06%3||Undergraduate and Graduate|
|4.34% – 12.99%2||Undergraduate and Graduate|
|4.37% – 11.23%*,4||Undergraduate and Graduate|
|5.03% – 11.23%5||Undergraduate and Graduate|
|4.12% – 13.13%6||Undergraduate and Graduate|
|5.62% – 10.01%7||Undergraduate and Graduate|
|3.93% – 9.81%8||Undergraduate, Graduate, and Parents|
|4.26% – 12.13%9||Undergraduate, Graduate, and Parents|