Before Getting A Bad Credit Private Student Loan: 3 Options To Continue College

Before Getting A Bad Credit Private Student Loan: 3 Options To Continue College

Have you heard of a bad credit private student loan? You can find them if you look. The trouble is that a bad credit loan may prey on your hopes, and lock you into a difficult payback.
If you have not been accepted for government student loans, like the Stafford, Grad/PLUS, or Perkins, or the Pell grant program, you may be considering one of these loans.

Think about your options. I have listed some below to help you finish your degree. You should also think about how much your degree will help you earn when you finish, and what you can pay on that loan.

Option 1: Skip the Student Loan If you could pay cash, you wouldn't want a loan, right? I know, but it is an option in some cases.

For example, can you sell your car and sign up for a payment plan for tuition? Many schools offer these plans now to help you get through.

Another quick example: Work two jobs during the summer, and save up enough to pay for college. Plenty of people do this. You could take a semester off while you work and earn the money you need. Rough, but you won't have to pay back a bad credit private student loan, which is nice.

All right, enough of that. Next option.

Option 2: Get a Cosigner You probably see the difficulty here: You have to have a cosigner to do this. Most people don't really want to sign for a student loan. Some of these loans have higher interest rates, too.

If you are trustworthy, and you have parents or grandparents who can sign, you might ask them.

Pretty vanilla. What else can you do?

Option 3: Tuition Reimbursement/Tuition Assistance If you have a good job now, and want a degree to make it better, this works wonders. It did for me.

Many companies offer this as a way to reduce employee turnover and keep good people. Then, when you want to go to college, you apply to your company for this benefit.

In tuition assistance, you get some help paying for classes. With tuition reimbursement, you turn in your grades from a successfully completed class and then get a check to reimburse you part of the tuition money you spent.

It's a great option if you have access to it, and will help prevent you from taking out a bad credit private student loan.

Option 4: Use a Different Loan When I say a different loan, I don't mean another type of student loan. I mean skip student loans and go to something else.

For instance, you could use a personal loan. Or you could use a line of credit on your house. Or a loan from your 401K. If you have bad credit, this can help you. Your 401K loan probably has a set interest rate, like 8%. You are borrowing your money, so the rate is better than a bad credit private student loan.

The same goes for a line of credit on your house. You can lower your borrowing costs this way.

If possible, don't borrow to go to college and get a degree. Try to pay cash or use the Pell program or scholarships if you can. Those loans can last for a long time, and you don't need more debt.