Student Loan Approval
What if I'm denied a student loan?
The bad news is unavoidable: your application for a private student loan has been denied. Don't panic or think this means you won't be able to attend college. There are still plenty of possible avenues to pursue. First and foremost, be sure you apply with a cosigner.
If you apply on your own, without a cosigner, and are denied, it's probably because you have insufficient personal credit history, as is typical for younger applicants. You'll simply have to find a qualified cosigner and reapply.
That cosigner could be anyone of your chosing, typically a parent or other guardian, a grandparent, an older sibling or perhaps an uncle or aunt. By cosigning your loan, they're agreeing to personally step in and help repay the loan in the event you cannot. At the same time, it doesn't remove your role as the primary borrower. You and the cosigner are equally responsible for repayment.
If you apply with a cosigner and are denied a student loan, you can find another qualified cosigner and reapply. The good news is that there are benefits to serving as a cosigner and some lenders do offer the option to be released as a cosigner after a certain period of on-time payments. For example, our TruFit Student Loan™ has a cosigner release option available after 36 consecutive on-time payments.¹
How to establish good credit
Here are a few pointers on how you can establish good credit, so that in the future you'll possibly qualify on your own:
- Start out small—Establishing good credit takes time. Start with one credit card.
- Pay on time, every time—Never miss a monthly payment.
- Don't pay down, pay off—Pay your credit card bills in full each month.