If you have poor credit, it can be tough to find a student loan lender willing to work with you. Adding a co-signer with a solid credit profile may help you qualify for the funds you need to further your education. The best student loans for people with bad credit have flexible co-signer options that will allow you to release your co-signer from the loan as you build your credit.
For most students, regardless of credit score, it’s best to exhaust your federal student loan options before turning to private lenders. But if you’ve hit your federal loan limits and need to borrow more, these private lenders may be a smart choice.
We looked at a variety of different lenders and considered interest rates, repayment options, amounts available to borrow, co-signer requirements, and other factors to find the best student loans for bad credit.
Best Student Loans for Bad Credit
- CommonBond: Best Overall and for Borrower Protections
- Ascent: Best for Co-Signers and Independent Borrowers
- SoFi: Best for Graduate Students
- College Ave: Best for Undergraduate Students
- Earnest: Best for Flexible Repayment Options
CommonBond: Best Overall and Best for Borrower Protections
CommonBond offers a variety of rates for loan amounts up to $500,000, including variable rates that range from 3.20% to 6.09%, and fixed rates that range from 3.21% to 6.45% (after the 0.25% autopay discount). This lender offers loan terms of up to 20 years and doesn’t charge origination or prepayment fees. However, you will pay a late fee of 5% of the unpaid amount or $10, whichever is less, and a $5 fee if a check is returned.
CommonBond looks for a minimum credit score of 660, so keep that in mind when you’re working with a co-signer. CommonBond offers a generous release program. After making 24 on-time payments, your co-signer is eligible for release, as long as you meet credit criteria. On top of that, its forbearance period is 24 months, which is longer than many other lenders and you can also refinance parent PLUS loans into your own name.
Refinance parent PLUS loans into your name
Hybrid interest rate options
Long forbearance period
Most loans require a co-signer
Does not offer loans in Nevada or Mississippi
Ascent: Best for Co-Signers and Independent Borrowers
Ascent offers options specifically for both borrowers with co-signers and those without, although if your credit is poor, the co-signer options are the ones for you. Its co-signer loans come with the option to release a co-signer after 24 consecutive on-time payments. However, Ascent also allows Deferred Action for Childhood Arrival (DACA) students to receive student loans if they are co-signed by a U.S. citizen or permanent resident. Ascent requires a minimum loan amount of $1,000 and a maximum of $200,000. Ascent also offers the option to borrow $20,000 per year on future-income loans. Fixed rates range from 3.62% to 14.50% APR, and variable rates range from 2.73% to 13.01% APR (after signing up for autopay and receiving an interest rate deduction of 0.25%).
Cash Back Graduation Reward
Offers scholarships to students
Income requirements for borrowers without a co-signer
Lower maximum borrowing limit than other lenders
SoFi: Best for Graduate Students
SoFi is a good choice for graduate students because there is no upper limit on amounts you can borrow (though it must be more than $5,000). Other lenders might have total limits for undergraduate and graduate loans, but SoFi will allow you to borrow up to the total of your student loans. For graduate students who likely have undergraduate loans as well, this can be important. SoFi requires borrowers (and co-signers) meet minimum credit and income requirements. SoFi offers fixed rates that range from 4.13% to 11.83% and variable rates that range from 1.80% to 11.73% (with the autopay rate discount of 0.25%). Loan terms range from five to 20 years.
Loan limit equals total education loan balance
Member benefits like unemployment protection
No origination or prepayment fees
No co-signer release for refinanced loans
College Ave: Best for Undergraduate Students
With College Ave Student Loans, variable rates range from 1.24% to 11.98% APR, and fixed rates range from 3.99% to 12.99% APR, as long as you sign up for autopay and receive the 0.25% rate discount. College Ave offers a number of resources for undergraduate students to help them navigate the process, including a look at the differences between various loans. Your co-signer may be eligible for release after 24 months of on-time payments.
There are different repayment options, with four terms between five and 20 years. Loan amounts start at a minimum of $1,000 for undergraduate and graduate students and cover 100% of the cost of your school. There are no application, origination, or prepayment fees, but it does charge a late fee if your payment is over 14 days past due (fee depends on payment amount).
Co-signer release after 24 full, on-time payments
Career loan options
Does not offer refinancing in Maine
Earnest: Best for Flexible Repayment Options
Earnest offers a number of flexible and customized repayment plans. First off, you have the option to skip one payment each year (although interest will still accrue). Next, you can sign up for biweekly automatic payments to help pay off your loan faster. Earnest does require co-signers to have a minimum credit score of 650. Variable rates start at 2.74% APR, but are not offered in Alaska, Illinois, Minnesota, New Hampshire, Ohio, Tennessee, or Texas. Fixed rates start at 4.39%. These rates reflect the 0.25% autopay discount.
Customizable repayment options
Nine-month grace period
Loans not available in Alaska, Connecticut, Hawaii, Illinois, Nevada, New Hampshire, or Texas
How Do I Get a Student Loan With Bad Credit?
The reality is that the best student loans for bad credit are likely to require a co-signer. While you can get a student loan with a credit score in the fair range, you might have to pay a higher interest rate because of it. In some cases, you might not be able to get a loan at all without a co-signer. If you have bad credit and need to borrow to pay for school, a co-signer might be necessary.
How Do I Know What Credit Score Range I Am In?
Bad, or poor, credit refers to your credit score. Your credit score is determined by your payment history, length and types of credit, amounts owed, and new, or recently acquired, credit. There are a few different credit scoring agencies that offer you a credit score. FICO credit scores are popular and are often available for free via your credit card company or bank. FICO credit score ranges are as follows:
- Excellent Credit: 800-850
- Very Good Credit: 740-799
- Good Credit: 670-739
- Fair Credit: 580-669
- Poor Credit: 300-579
Pros & Cons of Getting a Co-Signer for Student Loans
A co-signer can help you get a student loan when you have bad credit. On top of that, even if you can qualify on your own, a co-signer can help you get a lower interest rate. However, co-signers are also on the hook if you miss payments. This can put strain on your relationship with the co-signer, especially if you miss payments and your co-signer’s credit is damaged as a result.
Qualify for student loans when you might not otherwise
Get a lower interest rate than what you’d get on your own
Co-signer’s finances could be impacted
Could place strain on your relationship
Not all lenders offer co-signer options or releases for all loan types
Many lenders will “release” your co-signer from your loan after you’ve made a certain number of on-time payments and fulfilled other obligations—but not all. If your lender does not, your only recourse may be to refinance your loan once your credit has improved.
How to Choose a Student Loan Provider
When choosing among the best student loans for bad credit, it’s important to start with companies that will lend to you. Check to see if there are credit score requirements and options for co-signers to help you qualify for lower rates. If you do find a co-signer for your student loan, consider a lender that offers a co-signer release after you’ve demonstrated you can take over the monthly payments.
Other items to consider when choosing a student loan provider for new loans or refinancing old ones include:
- Interest rates
- Payment options
- Hardship or forbearance programs
- Ability to defer payments if you go back to school
Many student loan lenders offer terms of up to 20 years, and have some sort of forbearance program. Additionally, most won’t charge origination fees or prepayment penalties.
While a long forbearance period can help borrowers when money is tight, be aware that in most cases, interest will continue to accrue, increasing your loan amount and lengthening the repayment period.
How We Chose the Best Student Loan Companies for Borrowers With Bad Credit
In order to choose the best student loans for bad credit, we compared about 20 different lenders. We considered factors like interest rate, loan amounts, co-signer releases, repayment periods, forbearance periods, hardship options, and more. Different items were emphasized for different categories in an effort to provide recommendations for a variety of potential situations.