Your Questions About Student Loans For Bad Credit
James asks…
Where to get reliable low-interest student loans with bad credit?
I am in dire need of obtaining a student loan for this coming semester (Fall 2010) but, I still have 2 student loans owed totaling around roughly $10,000. I recently applied for a credit card, and unfortunately was denied. After doing so, I went and checked my credit, nothing seems to be wrong with it, it just doesn’t look too nice. Is there any way I could find a low interest-bad credit student loan? And if so, where? Thank you to anyone who even reads this post, I’m getting desperate. 
Joe answers:
You seem determined to destroy your life with debt
You cannot get a student loan if you already have two outstanding
Would you really loan somebody $500 if they already owe you $1,000 with no repayment in sight?
Linda asks…
How to consolidate my private student loans with bad credit.?
I have student loans with sallie mae. I have around 76,000 with private and federal student loans. I have ran out of forberence. I had to use my forberences in the past because of no job or not enough money to make payments. Well…now my payments is over 1500 a month. I will be starting a new job next monday. I will be making around 2000 dollars a month. My wife and I and my mother have a house together and our morgage is 1775 and i also have a son. As you can see theres no way I can make that high of a payment. i now have very bad credit because of the student loans. My mother was also the co signer for the loans and she has bad credit. My wife dosnt have very good credit also. I guess you can say that I dont have another co signer to use. I am trying and stressing on how to pay my loans and getting my credit back. If anyone knows or can give any advice please please do.
Joe answers:
Sounds like you want a chance to get your loans paid back and restore your credit to a healthy level. Have you talked to Sallie Mae to explore all options and help get your monthly payments to a manageable level? Give them a chance to help – they will. Call toll-free at 888-2-SALLIE and provide them with your account number. Tell them exactly what you’ve blogged here and ask them for help on repayment options, including consolidation for both types of loans.
If you haven’t consolidated your federal loans yet, that might help you. You don’t need a cosigner to do that. And you can typically consolidate as long as none of your loans have defaulted. If you can consolidate your federal loans, try to get a deferment called “financial hardship deferment.” Then you can focus on paying down your private loans. Hope this helps.
Mark asks…
What are the best student loans for bad credit/no credit.?
Stafford loans are based on income right? If I don’t get any government aid, what is the best loan for me if I have somewhat bad credit. I need something with a low interest rate. My tuition is going to be about 21,000 a year. I am also an undergrad student.
Joe answers:
Ace:
No, Stafford loans are not based on income or credit. That’s why the Stafford lending program is such an important part of the financial aid system, and why so many students rely on them.
To become eligible for a Stafford loan, all you need to do is complete the Free Application for Federal Student Aid, better known as the FAFSA. You will only be denied a Stafford loan if:
You are not a “regular” student (as opposed to conditionally enrolled)
You are not working on a degree or certification granted by your school
Your school is not a participant in the federal student aid program
You are not a US citizen, or eligible non-citizen
You are in default on a previous federal student aid loan
You owe an overpayment on previous federal student aid
You were convicted of certain drug offenses that occurred while you were receiving federal student aid.
If none of those things apply to you, you will automatically be offered an opportunity to borrow from the Stafford lending program. The catch is that the Stafford program has annual borrowing limits.
A financial aid dependent freshman can borrow a maximum of $5500 for the entire academic year. Sophomores can borrow $6500, and juniors and seniors can borrow up to $7500.
The Stafford loan has THE lowest interest rate of any educational loan (other than the Perkins, which is only offered to the neediest of financial aid applicants). You’ll pay a 6.8% fixed rate for the entire life of the loan – and you’ll have 10 years to repay. The repayment obligation does not begin until 6 months after you leave school.
The Stafford application asks no questions about your income, your debts or your credit history, and the loan is entirely in your name. There are no questions about your parents, and you will never be asked for a cosigner.
The government offers another lending program that complements the Stafford, the PLUS loan program, but that program is only available to the parents of undergraduates. If your parents are looking for a way to help you with the costs of school, they can borrow up to the full cost of your attendance with a PLUS loan. The PLUS program is different in that it IS a credit-and-income loan – your parents’ application would be subjected to traditional lending analysis, to determine whether they qualify for the loan.
If the Stafford (and possibly the PLUS) is not going to solve your financial need, you have a significant problem. The only other type of loan is the so-called “private” or “alternative” loan – educational loans that are offered by banks outside of the government’s programs. First of all, these loans are almost always far more expensive, with higher interest rates and higher fees, second of all, these loans are all credit-and-income loans, which are only approved for applicants who can satisfy the bank’s conservative lending criteria, and finally, there are a small handful of banks that are still making this kind of loan at the present time. If you go to Chase or Citi or Wells Fargo, it is nearly 100% likely that you will be required to provide a cosigner if you are going to be approved for a “private” educational loan.
I hope this information helped you – good luck!
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