Credit rating is a very important indicator. You need to work on it from the early stages of your life. Banks and various credit reporting agencies keep track of your financial activity from the moment you start using credit. Your credit history includes the list of your debtors, account statuses and the amount you borrowed. If you’re late with your payments this will affect your credit score.
It is more difficult to get rid of the bad credit rating than pay back your debts on a regular basis. Otherwise, the banks will put you in a category of a ‘high risk borrower’. People with poor credit history are still qualified to get no credit check loans. If you wish to get a student loan, there are various options even if you have a bad credit rating. Various governmental programs are aimed at helping students with their loan applications. Nonetheless, your credit rating is still important.
Tips to apply for a student loan
- First of all, you need to get a copy of your credit history from several major credit reporting organizations, such as TransUnion, Experian and Equifax. The US Federal Law allows you to get one credit report for free annually. If you need to get several copies of your credit report you may pay additional fees.
You can request your credit report by filling out a form at AnnualCreditReport.com. You can either print the forms out and mail them or request the reports through a toll-free number.
- When you receive your reports you need to review them carefully. Make sure there are no mistakes or errors. If you spot a mistake in your report, contact the credit agency to clear this matter out.
Credit scores may vary from 300 to 850. You can get a prime loan with favorable terms if you have a credit score over 700. High risk borrowers normally have a credit rating less than 600.
- The next step is to apply for a Federal Student Loan program despite the fact that you have a poor credit rating. For example Stafford loan doesn’t put an emphasis on the credit history of the applicant. Almost anyone is qualified for this loan.
Federal education loans do not normally cover the entire tuition amount. There is a limit for the first year of your studies; however, it may be increased the next year. The government may also subsidize some amount of your loan. You don’t need to repay the subsidized part of your loan.
- Alternatively, you can set an appointment with a professional loan officer to discuss financial solutions for your situation. You can find out more about lending agencies in your area that offer favorable student loans.
- You can do your homework and research potential credit organizations, their rates, requirements and conditions. Keep in mind that rates and terms may differ from one lender to another.
- Try improving your credit record before applying for the student loan. You need to repay all your debt and bills to improve the record. If you act responsibly you will have a chance to raise your credit rating soon enough.
This is a guest post written by Dan McCarthy. Dan is a freelance writer and part-time guest blogger who shares his business tips, such as advices on no credit check loans on various sites.