Securing Student Loans With No Credit Checks Opens Up Funding for College-Goers
The fact some lenders are willing to grant student loans with no credit checks illustrates the opportunities open to college-goers. If nothing else, this offer makes accessing funds for college education easier.
Besides, there is a logical reason for their poor credit status. With no credit history to indicate past repayment habits, lenders can only assume there is a higher risk than may be the case. In every case, it is up to the borrower to earn their reputation.
But when credit status is put to one side, the opportunity to get the loan approved quickly becomes much more probable. Still, there are plenty of aspects to a student loan agreement that need to be paid attention to. Remember, there are federal and private lenders to source a loan from, while the growth of the online lenders has added another option.
Approaching Banks and Independents
Of all the options, banks and independent lending firms offer the least competitive terms for all loans. So, there can be little surprise in the knowledge that finding one willing to approve a student loan with no credit checks can involve a lengthy search. Their only concern is that the applicant can make the necessary repayments on time, without a hitch.
Commonly referred to as commercial or private lenders, they still manage to offer some pretty neat concessions to help their student customers along. These include a period of grace that can stretch to up to 6 months after graduation. Of course, there is no college loan approved quickly (takes at least 24 hours), but a credit history is of little importance when the student is only beginning the credit journey anyway.
Still, the interest rate is higher when there is no check carried out, since the lender wishes to minimize the potential losses should the borrower default. Also, with a generous period of grace, the pressure of repaying the student loan can eventually hit all at once.
Turning to the Government
The government offers considerably generous loan deals to students, but then they are the future entrepreneurs, industrialists and financial whizzkids of the country. Investment in them is only logical, and offering student loans with no credit checks is too.
But government cogs turn slowly, so there is little chance of getting your loan approved quickly. First, applicants have to fill out a federal student aid form, with proof of financial need if seeking a subsidized loan. The choice rests between the Stafford Loan and Perkins Loan programs - and there are differences between them.
A Stafford Loan is issued by private lenders but subsidized by the government, so they pay the interest. The unsubsidized version means the student pays the interest on the student loan, but not until the period of grace ends.
A Perkins Loan is exclusively for students that are already in real financial dire straits. So, freshmen students cannot apply, proof of financial state is required, and applications are submitted to the financial aid office on campus.
Turning to Online Lenders
The growth on the online lending sector has made a world of difference to those seeking loans with bad credit histories. So, when looking for a student loan, with no credit checks a strong preference, it is one of the best places to turn to.
The reason for its usefulness is not that it is generally possible to get a loan approved quickly, it is because the terms of a loan are usually very competitive. It is the same with student loans, but a superior option because anyone can qualify, and the funds can be used to cover college fees and living expenses, or whatever the student needs it for.
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ABOUT THE AUTHOR
Melissa Kellett has a Master in Finance and has been a university teacher as well as a financial consultant for years. She specializes in Bad Credit Loans Guaranteed and also in helping people to get approved for home loans, guaranteed loans, bad credit auto loans, guaranteed credit cards, Bad Credit Mortgage Loans among many other financial products. For further information, please visit http://www.speedybadcreditloans.com