Many nontraditional college students, such as single mothers, have trouble paying for their education expenses. This is because single moms historically haven’t had equal access to grants and scholarships as high school graduates in recent days. Today many options are available to single mothers and many nontraditional students in the United States who want to pursue higher education and acquire a college degree.
Can Single Moms Get Student Loans While Dealing With Bad Credit?
Credit scores play an essential role in deciding the loan eligibility of borrowers. This can pose a hurdle for single mothers with poor credit as they fail to avail of many loan and assistance programs due to poor credit scores and damaged credit histories. Single moms can navigate the financial landscape while dealing with lousy credit. With consistent repayment to improve their credit scores and careful planning, they can avail of many options. Federal assistance programs, secured loans, and specialized lenders are some ways single moms can get student loans.
1. Specialized Lenders
Many specialized lenders provide funding to single moms with poor credit scores. These lenders cater to individuals who have faced financial difficulties and need funds.
2. Secured Loan
The second option is secured loans for single moms with bad credit. Even though these loans come with a collateral requirement, they are a feasible option. Defaulting on the loan carries the risk of losing the collateral assets; however, these loans have easy credit requirements and lower interest rates.
3. Applying For Federal Student Loans
Single moms can be eligible to receive funding through federal student loans like any other high school graduate. The Department of Education provides Direct Subsidized Loans, Direct Unsubsidized loans, and Direct PLUS Loans to assist single moms who need funding. While Direct Subsidized Loans are made for undergraduate students having high financial needs, these loans enable single moms to attend college or vocational school. Direct Unsubsidized Loans are available for undergraduate and graduate single mothers students, and demonstrating financial need is not a mandatory criterion to avail of these loans. Direct PLUS Loans are made for graduate students and parents of dependent undergraduate students.
What Are The Different Options Single Moms Can Avail To Get Student Loans?
There are a lot of financial aid and student loan programs designed for borrowers having bad credit. Single mothers can avail of these programs to fund their education. Each loan and financial aid program has its approval standards and guidelines. For instance, a private loan funded by a private lender or a bank comes with strict eligibility standards and short repayment terms. On the other hand, a federal loan option will be a viable option for students with bad credit as these loans do not consider the credit score of the borrowers. The loan amount sanctioned through federal student loans may depend on your previous credit history and the school you are attending.
Federal loans have longer repayment terms and lower rates of interest. In addition, you can also be eligible for forbearance with federal student loans. However, private student loans will never allow borrowers to pause their payments. Stafford loans are a popular federal student loan option reserved for students, including single mothers with high financial needs, and incur lower interest rates. The application for Stafford loans will look at the credit score and your income to decide the interest rate and the loan amount. Perkins loans also have similar eligibility requirements to that of Stafford loans and consider loan applications of single mother students having exceptional financial needs. Some federally funded student loans allow single mothers to pause their payments temporarily through financial assistance or other payment assistance programs. Apart from student loans, single mothers can also qualify for government grants, scholarships, or Pell Grant that helps them to cover their education expenses and require no repayment. If you’re a single mother and need help to cover your childcare costs while you are pursuing education, then you can apply for a Parent PLUS loan.
What Are The Different Types Of Student Loans For Single Mothers With Bad Credit?
Navigating life as a struggling single mother can be a challenging journey filled with financial obstacles and rewarding experiences. Balancing a job, self-care, and child-rearing, pursuing higher education while maintaining financial stability seems an uphill task for many single mothers throughout the United States. This is why a lot of them opt for college loans for single moms with bad credit, which play a critical role and act as a safety net for these individuals
1. Stafford Loan
If you are looking for a student loan with bad credit, then the best option is to start with federal loans, as most of these loans do not require a credit check and also come with robust borrower protection and lower interest rates. One such loan is Stafford Loan. Although Stafford Loan is not a primary representation of loan programs for single parents however, a lot of single parents having lower credit can opt for this loan since this is a federal loan that comes with lower rates of interest. Stafford Loan is a federally subsidized loan based on the income of single parents. In other words, subsidized loans mean lenders will cover the interest rates while the student attends an educational institution.
The Ascent student loan option is a non-co-signed, outstanding student loan designed for college juniors and seniors. The eligibility criteria of this student loan option take your school, academic performance, and many other factors into consideration. Single moms with minimum credit scores can qualify for Ascent loans. It claims that student loans are based on their future income. Therefore, single mothers can qualify for this loan if they pursue a high-earning field of study. They can apply for these loans if they are looking for undergraduate or graduate loan programs. Single mothers who are looking for loans without a cosigner can benefit the best as Ascent is one of the few money lenders which offers loans and approves borrowers based on other necessary factors apart from their credit score; therefore, single moms need not have a cosigner to get approved. The loan amount that a single mom can get to fund their education differs between $2001 to $200,000. The repayment term length varies between 5 to 15 years.
3. Funding U
Single mothers with bad credit can apply for funding from new student loans. Funding U does not consider the credit score of single mothers in making lending decisions. Other eligibility factors like the career path, GPA, and academic achievements of the borrower are considered before approving their loan application. Funding U is an excellent option for single mothers who lack a cosigner and a credit history. Although the loan amount limits account for $20,000 per academic year, it is worth considering for low-income borrowers and undergraduate students who need additional funds after utilizing their federal loan allotment. This is the best undergraduate loan program and lends only to deserving undergraduate students with a strong financial need. Funding U is the only lender that accepts and approves undergraduate students without a cosigner. First-year students can also apply for loans from the Funding U.
4. Parent PLUS Loans
Single mothers who want to obtain a loan to cover their childcare costs while attending school or work apply for Parent-PLUS loans. This is a federally funded student loan program that enables single mothers to borrow money on behalf of their college-attending children. This loan covers the attendance cost minus other financial aid students get through scholarships or grants. Single mothers with poor credit can consider this federal student loan apart from private debt. It is also easy for single moms to qualify for Parent PLUS Loans, and every applicant will receive the same interest rates irrespective of their credit score. As it is a federally funded loan, therefore, it also comes with flexible repayment options, excellent protection as well as forgiveness programs. To qualify for this loan, single moms must be adoptive or biological parents of dependent undergraduate students enrolled in a school.
Private Student Loan Options
Single mothers who failed to qualify for Parent PLUS or other federal loans can consider looking for private parent loans. Private loans have strict eligibility requirements, and qualified borrowers must showcase a good credit score and steady income. A score of 600 or even higher refers to a good credit score. When single moms can avail of private loans with bad credit, they will likely receive higher interest rates; single mothers with poor credit histories should get themselves a cosigner that will enable them to bring down the interest rates on their loans. Single mothers, while shopping for private loans, must compare the interest rates from every lender and then decide which one is the right fit for them. Some of the private student loans for single moms with bad credit are as follows:
1. ASLA, Arkansas Student Loan Authority
This is a state lender which offers educational funding to residents of Arkansas. However, the minimum credit score required for single mothers in Arkansas is 650. This state lender offers a family loan, which provides different repayment options, vital customer service, and auto-pay discounts.
2. College Ave
This is a famous private student lender in the United States which offers flexible repayment options, affordable pricing, and also vital customer service. Although the minimum credit score may range in the mid 600, you can benefit through the repayment options of this private student lender.
This is a well-known private loan provider that provides many member benefits like career coaching and flexible repayment options. The fixed rate of interest on loans provided by this private lender ranges between 6.5% to 14.83%, while the variable rates of interest are in the range between 6.32% to 14.03%.
Best Student Loan Alternatives For Single Mothers With Bad Credit
The strict approval guidelines and higher interest rates on bad credit student loans are not viable options for many borrowers, including single mothers. In this case, they can opt for Income Share Agreements. ISAs or Income Share Agreements offer money to borrowers and accept a specific percentage of their monthly earnings as payment. Income Share Agreements can benefit single mothers and other eligible borrowers with bad credit as most agreements do not come with high-interest rates and strict credit requirements. But the Income Share Agreement payment amount may vary depending on your income. For instance, if you end up getting a higher-paying job or if your income increases, then you can pay back more in return to combat the amount you have borrowed through Income Share Agreements.
Student loans for single mothers with no credit or bad credit are accessible and feature a reasonable interest rate. These loans are available throughout the United States and come with different repayment options and loan amounts. Single mothers can narrow by examining the lender fees, eligibility requirements, and APR rates to learn which lenders provide the best deal. To apply for these loan programs, you need to choose a reputable online lender, check the eligibility requirements and fees of the lenders, prepare your supporting documents, fill out an application form, submit your application within the deadline, and wait for approval.