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I Need Money for College But I Have Bad Credit – What Can I Do?

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I Need Money for College But I Have Bad Credit – What Can I Do?

I have bad credit but I need a student loan for college! How can I get a loan when I need money for college, but I have bad credit?  Believe it or not, you are not the only one facing this problem or asking these questions.

In this economy, things can seem a bit hopeless when you are a low-income student in need of some financial assistance and bogged down with a young credit score or simply with bad credit.  There is hope, though!  There are more options out there for students with bad credit than you might know of.  Here are just some of the ways you can get a student loan for college even if you have bad credit.

Government Loans

When you apply for government loans, your credit history is not taken into consideration.  That means if you have been saying, “I need money for college, but I have bad credit!”, that won’t even matter.  They won’t even peek at your credit score, and it won’t affect your credit score.  The kinds of government loans you can look into are:

  • Subsidized Stafford Loans: These loans are federally funded, and the subsidization of them means that you will have less interest to pay over the course of the loan.  These loans are limited in the amount they can give, but it can definitely fill in some gaps for you.
  • Unsubsidized Stafford Loans: These are the same kind of loan as the prior, only you will have higher interest payments as they are not subsidized.  These are easier to qualify for, but will keep you in debt longer.
  • Perkins Loans: These loans are nice, but they have a total cap of $20,000 and you can only pull $4,000 a year.  This means they won’t cover everything, but for a student saying, “I have bad credit, but I need a student loan for college,” they might be just the thing.

There are more government or federally funded student loan programs, but these three are the most popular and the most helpful.  You do have to meet the qualifications for them, however.  The standards change every year and are slightly different between the three, but the main criteria of taking advantage of these student loans for bad credit are:

  • Low Income: The cap on this is usually around $15,000 a year.
  • Currently enrolled in school: If you aren’t a student, you don’t need a student loan.
  • Little to no personal assets: If you have any savings in the bank or if you own any kind of property, then you will be denied, even if you are constantly saying, I need money for college, but I have bad credit.
  • Passing marks in school: The government will not pay for you to fail and party your way through school.  You should have a decent GPA if you want to take advantage of these programs.

These are not options for everyone, but most people stuck in the I have bad credit but I need a student loan for college boat should be able to get some kind of assistance from these sources.

PLUS Loans

PLUS (Parent Loans for Undergraduate Students) are not your traditional loan.  They do require a credit check, but before you start hitting us with “I have bad credit and I need a student loan for college” hear us out.  PLUS loans are given to parents.

There is a credit check, but the credit that is looked at is the parents and not the student.  These loans are designed to give money to parents who have given money to their children who are in school.  Basically, you can get your parents to give you some money to help you with tuition and books and pizza and other college related things, and the PLUS loan will put that money back in their pockets.

The interest rates on PLUS loans are low, but they are there.  If this is making your parents nervous about putting out the money, maybe you can offer to pay them back the amount of interest that will be accrued, or you can sit down and make a plan to be responsible yourself for paying back the loan that you couldn’t get because of your bad credit.

This will require the cooperation of your parents, which dissuades many students from using them.  If you have a good relationship with your parents or guardians, then this is something to consider.

Bad Credit Student Loans

This is last on our list because it is the worst option on the list.  For those saying I need money for college, but I have bad credit, there are banks out there with loans just for you.  They don’t care about your bad credit and will give you the amount you need to finish out your schooling.

Why? Because they charge you a HUGE interest rate and they know through this, they will make money off of you even if you can’t pay out the full borrowed amount.  Many of these bad credit student loans will require payments while you are still in school- which is rare for most student loans.  Basically, they look for people with the I have bad credit but I need a student loan for college kind of people, and they take advantage of them.

However, if nothing else on this list works for you, then this may be your only option.  If you decide to take this route, be VERY careful!  Do not get tied into something that will hurt your credit score even more than it already is.  If you have someone you can trust to come with you, they can help you spot the traps that are laced into some of these bad credit student loans.

There you have it. Even if you have bad credit and need a student loan for college, you can find something for you!