Even With Bad Credit Student Loans Are Still Possible - By: Jimmy Chuang

Even for students with bad credit, student loans are still a very real option to get the funding needed to attend two and four year college and university programs as well as to attend specific trade school courses. Since credit scores are often used in determining funding levels for students, it is often assumed with a prior money management problem leading to bad credit, student loans are out of the question. Even with thin credit, which is not the same as bad credit, student loans can be a problem if you are going through a private loan agency or company.

The way to handled problems such as bad credit, student loans with a thin credit or no credit history, is to research and investigate student loan options that are not based on credit scores. There are many different federal student loans that are either subsidized or unsubsidized and are offered by the federal government with no ties to your credit score for eligibility. These loan programs include Stafford Loans and Perkins loans but may also include scholarships, Pell grants and other private grants and bursary programs.

Stafford loans are one of the most common bad credit student loans that can actual prevent students from having to pay interest on the loan provide they qualify for a subsidized loan. Students will still have to pay of the principle or total amount of the loan but provided they follow the payment plan the government will not charge any interest. These subsidized loans are granted based on the student's resources and financial ability to pay back the loan. Students must graduate and will have 6 months in which to start earning a living after graduation before payments start. If students drop down to a part time student or drop out of school the payment process is not deferred as long and interest may be charged.

Perkins loans are another option for bad credit student loans that are subsidized and can be applied for each year. With both Stafford and Perkins loans the amount of the loan is capped, and will not typically be more than $5000 per year, even in senior years. The total amount borrowed under the Perkins loan program cannot exceed $20, 000 per student in total over all education years.

For students with bad credit, student loans through private loaners and companies are likely not an option. Be vary cautious in taking on these loans as they often have very high interest rates, poor payment plans and extremely high penalties. If at all possible students with poor credit should work on rebuilding their credit scores through timely repayment of a federal government loan and displaying credit worthiness before trying to apply for private school loans.

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