<p><img class="alignleft size-full wp-image-2599" src="https://www.scholarshipsinink.com/wp-content/uploads/what-types-of-student-loans-are-available-for-parents-with-bad-credit.jpg" alt="Credit score on a laptop" width="800" height="533" /></p>
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<p><span class="dropcap">N</span>o parent wants to hear that they may have trouble getting student loans because of their credit. It feels like you&#8217;re letting your child down, and that&#8217;s one of the worst feelings in the world. Fortunately, your bad credit won’t prevent your child from paying for school. T​here are several ways you can secure student loan funding for your child, even if your credit is bad. We&#8217;ll cover the options in this article.</p>
<h2>L​oans for your student.</h2>
<p>Your child can apply for student loans on their own, and your credit won&#8217;t affect these. They can apply for subsidized loans from the federal government, which have low-interest rates and won&#8217;t enter into repayment until they graduate from college.</p>
<p>These loans are designed for people with little to no credit history, so they don&#8217;t require a credit check. If you think your bad credit will make it difficult to get a student loan, this is a great way for your child to pay for their education.</p>
<h2>Parent PLUS loans.</h2>
<p>That said, a lot of parents are uneasy about their children taking out loans, especially when those loans are for tens of thousands of dollars. These are federal loans that you take out in your child&#8217;s name. They&#8217;ll cover the full cost of education, minus any other financial aid your child receives.</p>
<p>These loans allow you to authorize how the school can use the loan money, as well as who gets any extra money from the loan after tuition is repaid. You can begin repayment immediately or defer payments until 6 months after your child graduates.</p>
<p>These loans do require a credit check, but there&#8217;s no minimum credit score requirement. <a title="StudentAid.gov link opens in a new window" href="https://studentaid.gov/understand-aid/types/loans/plus/parent" target="_blank" rel="noopener" data-lasso-id="343">The only thing they&#8217;re checking for is adverse credit</a>. Adverse credit includes things like delinquent account balances of $2,085 or more in the last two years, bankruptcy in the last five years, repossession or foreclosure in the last five years, wage garnishment or a tax lien in the last five years. These could all prevent you from getting a PLUS loan.</p>
<p>Other than that, you&#8217;re likely to qualify. Bad credit scores alone won&#8217;t hold you back. What&#8217;s more, the interest rate on your PLUS loan isn&#8217;t determined by your credit score. You don&#8217;t have to worry about being gouged with interest if your credit is bad.</p>
<p>If you have adverse credit, you can still get a PLUS loan, but you&#8217;ll just need an endorser. That&#8217;s someone who agrees to repay the PLUS loan if you can&#8217;t. It can&#8217;t be your child, but if you have friends with good credit, or at least no adverse credit, they can be your endorser as well.</p>
<p>The role of endorser is unpredictable because they are legally required to pay the loan if you can&#8217;t. Plus, if you miss a payment, it will affect the endorser&#8217;s credit score as well as yours.</p>
<p>You can also submit an appeal if you&#8217;re denied a PLUS loan. If you can prove that your adverse credit history was the result of extenuating circumstances, you can often win the appeal. For example, if you can show that you paid off the accounts that were delinquent, or that your delinquency or foreclosure was the result of circumstances beyond your control (i.e. losing your job) that have now been resolved (i.e. you got a new job), you can still qualify for the loan.</p>
<h2>Private student loans.</h2>
<p>Most student loans are federal loans, which are easy for students to qualify for, but the other option for parents with bad credit is private student loans.</p>
<p>Private loans are given out by banks or online lenders that specialize in student loans. They are harder to qualify for since the lenders pay much more attention to credit history than the Department of Education does. However, if you don&#8217;t qualify for a PLUS loan, you may be able to qualify for a private loan if you have a co-signer.</p>
<p>In some cases, if you are awarded a loan with bad credit, you may get it with a higher interest rate. This can be risky, but if your credit is bad enough, it may be your only option. Shop around with several lenders to see where you&#8217;ll get the best deal. Private lenders don&#8217;t have universal standards, so you probably find some lenders willing to give you better terms on your loan than others.</p>
<p>It&#8217;s best not to rely on private student loans for the full cost of your child&#8217;s education. They have higher interest rates, and there are far fewer protections for the borrowers than you get with federal loans. Instead, turn to private loans once federal loans, grants, and scholarships have all been exhausted. That way, you&#8217;re only taking them out to cover a portion of tuition and not the whole cost.</p>
<h2>Are there other loan options?</h2>
<p>Parent PLUS loans and Private Loans are really the only student loan options for parents. Other student loans are meant to be taken out by the students themselves. Fortunately, most people can qualify for PLUS loans, even if they have bad credit.</p>
<p>If you can&#8217;t qualify for these loans, your best bet is to try and improve your credit score, while applying for more <a title="What Types of Scholarships Are Available?" href="https://www.scholarshipsinink.com/what-types-of-scholarships-are-available/">needs-based aid</a>.</p>
<h2>Takeaway.</h2>
<p>Y​our bad credit shouldn&#8217;t prevent your child from getting an education. You probably qualify for Parent PLUS loans, which will enable you to pay for your child&#8217;s education. And, even if you can&#8217;t qualify for PLUS loans or private loans, your student will still qualify for federal student loans.</p>
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