The cost of college is increasing, and to pay for tuition, fees, not only, but also living, many students choose to take a student loan to pay part or all of their education. Although there are many loan programs for parents of students, it is quite possible for a student to take a loan without a cosigner required.
A student loan without a co-signer is someone who signs with you to get a loan, which guarantees that the loan will be repaid. This means that if someone co-signs a loan for you, that person is also responsible for repayment as you are. If the loan is in default, the person is subject to the same penalties. Lenders often require a co-signer in situations where the borrower has a poor credit history or no credit history. The latter is often the case with students who applied for student loans because they come just in high school and who have not yet established a credit history. Typically, a parent, legal guardian or other close relative is the co-signer. This person must have a reliable credit history and be 18 years of co-signing.
Types of loans
There are many different types of loans that students can take, some of which may require a co-signer and others that do not. The federal government sponsors a student loan program that was designed to help students pay for higher education. Federal student loan programs do not need a co-signer and do not depend on credit history, provided that the student has not already defaulted on a student loan from the federal government.
The government controls both types of student loans: subsidized loans, which are awarded based on financial need , which are available to all students, regardless of need. The government pays the interest on subsidized loans while a student is enrolled in school and during grace periods, as a reprieve and tolerance, while not paying interest on subsidized loans. There are two other options to borrow money for school: private lenders and nonprofit agencies and organizations.
Private lenders will evaluate your credit history to decide whether or not you are a good credit risk, which determines whether they require a co-signer. As there is no guarantee for a student loan (such as property that the bank can return), many banks no money to students who do not lend credit history unless a parent or another adult is willing to co-sign. Many charitable organizations offer loan programs for students with very competitive interest rates and flexible repayment plans. While some of these loans are awarded based on financial need, many are awarded to students through the writing contest or because the student meets specific criteria such as membership of a particular program of study .