The Secret To Obtaining A Bad Credit Student Loan

Posted by Nick Niesen on October 29th, 2010

It won't be easy, and you can bet that your search to find someone willing to offer you a bad credit student loan will take some doing, but with determination, you're likely to find someone willing to take a chance on you and fund your tuition expenses for another year or two.

However, be advised that if you already have accumulated bad credit, you're most likely going to only find loans that come with high interest rates attached. The good news is that you won't have to start paying back that student loan until you're finished with school, so you can start planning early to repay it. One of the mistakes most students make is to ignore the fact that sooner or later, they're going to have to start paying back the hundreds, thousands, and sometimes, hundreds of thousands of dollars of student loans that have accrued over the course of college and university studies. Most students don't even consider those loans until that first billing statement comes, sometimes weeks or several months after you've received that hard-earned diploma.

If you already have a bad credit history, it will be in your best interest to start putting money away during the course of your college education in an effort to repay those loans once you're finished with studies, and to be able to show any banker or money lender that you already have such a strategy in place. You will not likely find your school willing to finance you a loan if you already have a bad credit history, and maybe not even your local bank branch, either. A bad credit student loan may also depend on whether or not you have collateral to secure such a loan. If you don't, you'll be offered an unsecured loan, which automatically comes with higher interest rates. While you may shrug at the difference between a few points of interest, those few points may mean thousands of dollars by the time you've finished repaying those loans.

Always shop around when it comes to seeking any kind of student loan, and if you have bad credit, it's vitally important to tread cautiously and slowly. Take your time, never sign on the dotted line without thinking about terms offered for at least 24 hours, and never, ever let someone tell you that you have to decide right there and then or the deal is rescinded. Many moneylenders prey on those with a bad credit history, so you have to be alert and know a few basic terms when searching for a loan under those conditions. When applying for a bad credit loan, look around for those lenders who offer the best rates. You need to accept that you may be asked to pay 18-24% interest on any loan amount, which will certainly mean thousands of extra dollars. Loan services are designed to help others, but not for altruistic reasons. Everyone's out to make a dollar, and lenders are no different. They may come in handy at the time, but keep in mind that any money owed is a debt that must be repaid - somehow, sooner or later.