Best Student Loans for Bad Credit of July 2026
There are a number of factors to consider when finding the best bad credit student loan for you.
- Interest rates. Bad credit student loans come with higher interest rates, but there may be ways to lower them, such as adding a cosigner.
- Repayment terms. The amount of time you have to repay a loan is an important consideration. Repayment options like extending the term, deferring payments or refinancing can provide you with more flexibility in the future.
- Funding available. Consider how much funding each lender offers to ensure that it can meet your needs.
- Eligibility requirements. Lenders may require you to meet certain conditions to qualify for bad credit student loans, such as citizenship, age, credit history, income and enrollment status.
- Required fees. Some lenders may charge fees to apply for loans or for late payments, and it is important to include these when considering the total cost of the loan.
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- Pay your bills on time and in full every month. Payment history is a critical factor in determining your credit score. Keep in mind it can take a few months to improve your credit score if it isn’t strong to start with.
- Consider a secured credit card. Secured credit cards work like traditional credit cards, except the credit limit is secured by a deposit you make when you open the account. The deposit is usually equal to your credit line and can be used to pay your balance if you don’t.
- Keep an eye on your credit report. Do so “to ensure the credit agencies have accurate information on your balances, number of credit lines,” says Paramita Pal, head of customer experience at TD Bank. “Inaccuracies can hurt a credit score.” You can request a free copy of your credit report from all three credit bureaus – Equifax, Experian and TransUnion – on AnnualCreditReport.com.
Pros
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Finance your education. Bad credit student loans allow you to finance your education, even if you can’t qualify for other student loans.
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Options for cosigner. Some bad credit student loans may not require a cosigner, and others may offer a cosigner release option. This allows the cosigner to no longer be responsible for your student loan after a certain number of on-time payments.
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Improve your credit score. If you consistently make your student loan payments on time, you should see a rise in your credit score.
Cons
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Pay more interest. Student loan interest rates are generally determined by several factors, including credit history. This means that bad credit student loans tend to have higher interest rates, and you will pay more for your loan.
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Less flexibility. If you don’t qualify for federal student loans, you will have to get private loans. Private loans have less flexible repayment plans and often require you to make payments while you’re studying.
There are some alternatives for bad credit borrowers.
- Speak to your financial aid office. Some schools offer payment plans that allow you to pay tuition over several months instead of one lump sum.
- Apply for scholarships and grants. You may be able to reduce the need for loans by receiving scholarships and grants. To qualify, you will have to meet certain application criteria, which could be based on need or accomplishments.
- Look into a Parent PLUS loan. If you cannot qualify for student loans, your parents may be able to qualify for federal Parent PLUS loans. These loans are made to parents of undergraduate students and often carry high interest rates, with repayment starting right away.
- Consider a home equity loan. If you or your parents own a home, a home equity loan might be an option to finance your education. This borrows against the home’s value, requires a second mortgage payment and uses the home as collateral.
- Reduce your costs. If you’re unable to qualify for additional loans or funding, you may need to reduce your education costs. This could mean living at home while studying or attending a school with lower tuition.
U.S. News selects the Best Loan Companies by evaluating affordability, borrower eligibility criteria and customer service. Those with the highest overall scores are considered the best lenders.
To calculate each score, we use data about the lender and its loan offerings, giving greater weight to factors that matter most to borrowers. The scoring factors for private student loan providers are customer service ratings, fixed APR, variable APR, loan product availability, minimum and maximum loan terms, minimum and maximum loan amounts, minimum FICO score, and online features.
The weight each scoring factor receives is based on a nationwide survey on what borrowers look for in a lender.
To receive a rating, lenders must offer qualifying loans nationwide and have a good reputation within the industry. Read more about our methodology.
Borrowers with no credit can get student loans. Federal student loans are the best choice because they often don’t require a credit check.
You can get a student loan without a co-signer if you have bad credit or no credit – most federal loans do not require a cosigner – but you may need one to get a private loan.
Unlike need-based federal loans that the government funds, private student loans from banks, credit unions and online lenders often require a credit history to prove that you can pay back the debt. Many students have thin or no credit histories, making approval for private loans difficult.
A creditworthy cosigner on a private loan can help your chances of approval and secure a better interest rate than you would get on your own.
If you don’t want a cosigner on your student loan permanently, look for a loan with a cosigner release. This would allow you to release your co-signer from the loan after you meet certain requirements, such as making a set number of on-time payments.
Federal loans, except for Direct PLUS loans, don’t consider credit history. Many private lenders require a credit score at least in the mid-600s for a student loan. Eligibility requirements for private student loans depend on several factors, such as debt-to-income ratio, earning potential and household income.
Parents who want Direct PLUS loans won’t need to meet a credit score minimum but cannot have an adverse credit history. That means you can’t have debts more than $2,085 that are 90 days or more delinquent or in collections, among other credit problems.
