Best Student Loans for Bad Credit

Earnest offers the best student loans if you’re dealing with poor credit scores

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Finding the right private student loan for your education can be cumbersome. With the dozens and dozens of loan companies in the marketplace, it can be exhausting to find the right option. But if you have a poor credit score or bad credit history, it becomes even more difficult to find companies that will work with you.

However, having less-than-stellar credit can make qualifying for student loans difficult. Private lenders base their decision on your income and credit history. As a college student, you likely have poor credit or no credit at all, and you may struggle to find a lender willing to work with you. 

To help borrowers pay for college, we looked at the top lenders in the country to identify the best student loan options for people with bad credit. Some of these lenders are oriented more toward credit scores in the mid-600s, but they can be worth exploring as well. Whether you’re looking for private loans to supplement your school costs, or need to cover the majority of your schooling expenses, these companies offer a variety of loan options for you.

Best Student Loans for Bad Credit of February 2023

We recommend exhausting all of your federal student loan options before considering private loans. Federal loans can provide more flexibility and relief options, as well as student loan forgiveness.

Best Overall : Earnest


Earnest
  • APR Range: 4.79%–11.69%
  • Loan Amounts: $1,000–$250,000
  • Loan Terms: 10 - 15 years (20 years for ReFi)
Pros & Cons
Pros
  • Multiple loan and repayment terms

  • No origination, application, or late fees

  • Can skip one payment per year

Cons
  • Personal finance review required

  • Loans not available in all states

  • No co-signers on refinances

Why We Chose It

Earnest offers student loans and refinancing options with flexible repayment terms, a generous grace period, and several borrower protections. Both undergraduate and graduate loans are available, as well as parent loans for qualified borrowers. Earnest is backed by Navient, one of the largest private lenders in the student loan industry.

Earnest has a minimum recommended credit score of 650, and considers more than just your credit score to qualify. If you have an income of at least $35,000 and a history of on-time payments, you may be able to qualify for an Earnest private student loan or refinancing of your existing loans.

Earnest allows co-signers for undergrad and graduate loans, so if you can’t quite qualify on your own you can ask a trustworthy family member to help. It does not allow co-signers for loan refinancing, however. And though Earnest works with borrowers with less-than-stellar credit, you will be subject to a thorough financial review that may be more stringent than some other companies.

But overall, Earnest offers low rates, a variety of loan options, a generous grace period, and flexible loan terms, making it our top pick for student loans for borrowers with bad credit.

For more information, see the full Earnest Student Loans Review.

Repayment Options
  • Deferment: Payment can be deferred until nine months after graduation. Interest will still accrue, but no payments will be due while in school and during the grace period.
  • Fixed: Students can pay a $25/month fixed payment while in school and during the grace period. This lowers the amount of interest paid over the life of the loan.
  • Interest-only: Students can pay just the interest due on the loan while enrolled in school, which lowers the amount that is paid over the life of the loan.
  • Full payment: Students can pay the full payment amount on the loan (principal and interest), reducing the overall interest paid. This helps students save money in the long run and pay off the loan faster.
Eligibility Requirements
  • Must live in a supported U.S. state (all but Nevada)
  • Must be the age of majority as defined by state of residence
  • Must be a U.S. Citizen or possess a 10-year (non-conditional) Permanent Resident Card
  • Must be enrolled at least half-time (undergraduate loans only)
  • Must be pursuing a bachelor’s or graduate-level degree
  • Must be enrolled in a Title IV-qualified, not-for-profit, four-year institution
  • Recommended minimum FICO score of 650
  • At least three years of credit history
  • Income of at least $35,000 per year
  • No bankruptcy on credit reports
  • No past-due balances up to 365 days prior
  • Must have a history of on-time payments as the primary borrower on any revolving or installment account that is reported to a credit bureau
  • Must have no accounts currently in collections

Best for Graduate Students : SoFi


SoFi

SoFi

  • APR Range: 4.49%–13.80%
  • Loan Amounts: $1,000–total cost of attendance
  • Loan Terms: 5 - 15 years (20 years for ReFi)
Pros & Cons
Pros
  • Flexible repayment options and terms

  • No origination, application, prepayment, or late fees

  • No cap on borrowed amounts

  • Offers additional benefits, including career coaching and financial planning

Cons
  • Co-signer release requires 24 months of on-time payments

  • No co-signer release on refinances

Why We Chose It

SoFi offers private student loans and refinancing for both private and federal student loans. Loans have flexible terms, competitive rates, and SoFi offers additional member benefits, such as career coaching and access to financial advisors. There are multiple rate discounts available, and SoFi even has a referral program to earn extra cash.

SoFi offers several graduate loan options, with loans available for students pursuing a master’s degree, as well as MBA, law school, and medical programs. SoFi loans can be set up on repayment terms of 5 to 15 years in length, and you can borrow up to the total cost of attendance. 

SoFi does allow co-signers on student loans, which you will likely need if you have poor credit, but they cannot be released until 24 months of on-time payments. And if you are considering a loan refinance with a co-signer, there is no release option available.

SoFi is a solid choice for graduate students, and you can enjoy the extra perks of SoFi membership if you take out a student loan with them. Just be aware of restrictions on co-signer release.

For more information, see the full SoFi Student Loans Review.

Repayment Options
  • Deferment: Payments can be deferred until up to six months after graduation. Interest will accrue while loans are in deferment, but no payment will be due.
  • Interest-only: Students have the option to only pay the interest on the loan while in school. This will prevent interest from accruing during school.
  • Fixed: SoFi offers a fixed payment option, allowing students to pay just $25/month while in school. While interest will still accrue, this helps lower the overall interest amount while in school.
  • Full payment: Students can choose to make regular payments (principal and interest) while in school, starting the paydown term sooner. This option ends up being the least costly over the life of the loan.
Eligibility Requirements
  • Must live in one of the 50 U.S. states or District of Columbia
  • Must be the age of majority as defined by state of residence
  • Must be a US citizen, permanent resident, or non-permanent resident alien (documentation may be required).
  • Must be attending an eligible, accredited Title IV school.
  • Must be enrolled at least half time
  • Must be pursuing a bachelor’s or graduate-level degree
  • Borrowers must be employed, have sufficient income from other sources, or have an offer of employment to start within the next 90 days.
  • Recommended minimum FICO score of 650

DACA recipients and non-permanent residents are eligible for SoFi loans, as long as they meet the qualifying criteria.

Student Loan Marketplace : Credible


Credible logo

Credible logo

  • APR Range: 3.65%–15.16%
  • Loan Amounts: $1,000–varies by lender
  • Loan Terms: 5 - 20 years
Pros & Cons
Pros
  • Compare loan offers from multiple lenders

  • Flexible repayment terms

  • Pre-qualification available (no hard inquiry)

  • No additional fees

Cons
  • Does not include all lenders

  • Limited view of terms and conditions 

Why We Chose It

Credible is a private student loan marketplace that helps you compare the rates and loan terms of multiple lenders all in one place. You can fill out a single application, and Credible will show you the details for each lender, letting you quickly find the best deal and terms for your student loan. There are no additional fees for the service, either.

Credible also allows you to apply with a co-signer, which can help you qualify if your credit isn’t the best. And most lenders that Credible partners with offer forbearance and hardship options. Credible works with nearly a dozen top companies, but there are several reputable lenders not included, so you may still want to shop around after getting quotes from Credible.

Since Credible works with multiple lenders, qualification requirements will vary. And while you can see loan rates and terms listed side-by-side, there may be additional qualifications needed for certain loans, depending on the rate and term selected.

Credible is the leading student loan marketplace that charges no fees and helps you compare rates quickly with a simple online application.

For more information, see the full Credible Student Loans Review.

Repayment Options

Credible works with top student loan providers that offer a variety of repayment options, which may include:

  • Deferment: Payment can be deferred until after graduation and the grace period. Interest will still accrue, but payments will be paused.
  • Fixed: Students can pay a fixed payment (usually $25/month) while in school and during the grace period. This lowers the amount of interest paid over the life of the loan.
  • Interest-only: Students can pay only the interest on the loan while enrolled in school, preventing the balance from growing.
  • Full payment: Students can pay the regular principal and interest payment, lowering the amount of interest that is paid over the life of the loan, and paying off the loan sooner.
Eligibility Requirements
  • Must live in the U.S.
  • Must be the age of majority as defined by state of residence
  • Must be a U.S. Cctizen or permanent resident
  • Must be enrolled at least half-time
  • Have verifiable income

Best Without a Co-Signer : Ascent


Ascent
  • APR Range: 4.62% - 14.91%
  • Loan Amounts: $2,001 - $200,000
  • Loan Terms: 5 - 20 years
Pros & Cons
Pros
  • No origination fees

  • Co-signed and non-cosigned loans available

  • Juniors and seniors can qualify based on future earnings

Cons
  • Higher rates for non-cosigned loans

  • International students cannot release co-signers

Why We Chose It

Ascent offers a variety of private student loan options for undergrad and grad students, as well as professionals. Both co-signed and non-cosigned loans are available, and Ascent even offers outcomes-based loans to junior and senior students, allowing them to qualify based on grades and future earnings potential rather than credit and finances.

Accent offers loans starting at $2,001, with maximum borrowed amounts of $200,000 for undergrad students and $400,000 for grad students. Rates start under 4%, though you typically need a co-signer to get the best rates.

Ascent offers flexible loan terms from 5 to 20 years in length, allowing you to adjust your preferred monthly payment. And loans don’t come with origination fees, either.

For more information, see the full Ascent Student Loans Review.

Repayment Options
  • Deferred: Students can defer payments until nine months after graduation (12 months for dental students). Interest will accrue during deferment, but no payments will be due while in school and during the grace period. Interest is capitalized once repayment begins.
  • Fixed: Ascent offers a $25/month payment option while in school and during the grace period to help lower the amount of interest that accrues during school.
  • Interest-only: Students can pay just the interest on the loan, which keeps interest from accruing and being added to the loan before full payments begin.
  • Full payment: Students can opt to pay the full principal + interest payment while in school, saving the most money in interest out of the repayment options.
Eligibility Requirements

The eligibility for credit-based loans are:

  • Must live in the District of Columbia or the United States (all 50 states are supported)
  • Must be enrolled at least half-time (full-time for outcomes-based loans)
  • Must be a U.S. resident, have DACA status, or have a qualifying visa
  • Must be pursuing a Bachelor’s or graduate-level degree
  • Must be Enrolled in an Ascent-approved institution
  • At least 2 years of credit history
  • Income of at least $24,000 in the current and previous year (in USD)

For outcomes-based loans, here are the eligibility criteria:

  • Be a college junior or senior enrolled full-time at an eligible institution
  • Be a U.S. citizen or have a U.S. permanent resident or Deferred Action for Childhood Arrival (DACA) status.
  • Maintain a 2.9 GPA or higher
  • Be at least 18 years old (or age of majority) in your state of residence

Best for Refinancing : Splash Financial


Splash Financial Logo
  • APR Range: 4.47%-8.99%
  • Loan Amounts: $5,000–no maximum
  • Loan Terms: 5 - 25 years
Pros & Cons
Pros
  • Low rates

  • No maximum borrow amount

  • Spouses can refinance together

Cons
  • Loan rates and terms vary by partner

  • May need a credit union membership

Why We Chose It

Splash Financial is an online student loan refinancing marketplace that allows you to compare rates with several lenders to refinance your private or federal student loans. Some allow co-signers, helping you qualify if you normally wouldn’t on your own.

Splash’s minimum recommended credit score is only 640, and loans start at $5,000. There is no specific maximum loan amount for refinancing through Splash, but it will vary depending on your credit profile and the lender selected.

Splash is not a lender itself, but will pass along your application information to its partners and show you a variety of loan options. You can choose the best loan rates and terms that fit your needs, and you will get a loan directly from that partner.

Because some of Splash Financial’s partners are credit unions, you may be required to sign up as a member before being approved for the loan.

Splash Financial is a good choice if you’re looking to refinance student loans without the best credit score, and you want to compare multiple options at once. For more information, see the full Splash Financial Student Loan Refinancing Review.

Repayment Options

Splash Financial only offers student loan refinancing, which means normal principal-and-interest payments are due right away. The only exception is for medical students. 

If you are a student with medical school debt and are in a residency or fellowship program, you can pay a low $100/month payment during this time (and for six months afterward). This deferment option can last up to a maximum of 84 months.

Eligibility Requirements
  • Must be a U.S. citizen or permanent resident
  • Must be a graduate with an associate’s, bachelor’s, or master’s degree, or be a parent of a student

Best for Expanded Borrowing Criteria : Funding U


Funding U logo

Funding U

  • APR Range: 6.99%–12.49%
  • Loan Amounts: $3,001–$20,000
  • Loan Terms: 10 years
Pros & Cons
Pros
  • No credit score needed

  • Qualify based on GPA and projected earnings

  • No origination fees

  • Multiple forbearance options available

Cons
  • Only available in 38 states

Why We Chose It

Funding U is a student loan company that offers loans to undergraduate students based on grades and projected future earnings, instead of credit history. Funding U is focused on students who may not have access to a co-signer, but also have not had time to establish a strong credit profile to qualify for a loan.

While you don’t need a credit score to qualify, Funding U will review your current GPA, your chosen major and projected earnings, the earnings data from your chosen school, your total debt balances, and your credit history. Interest rates start fairly low, competitive with many top lenders.

You can borrow from $3,001 up to $20,000, so Funding U is best for smaller student loan needs (such as supplementing federal loans or grants). And repayment terms are locked in at 10 years in length. There are several repayment terms available, and multiple forbearance options in case of financial hardship.

If you are looking for a way to fund college but don’t have the best credit (or access to a co-signer), Funding U is a good option.

Repayment Options
  • Deferment: Students can defer payments until six months after graduation. Interest will accrue during this time period.
  • Fixed: Students can pay $20/month while in school and during the grace period. This helps reduce the amount of accrued interest.
  • Interest-only: Students can pay just the interest amount each month, which keeps the loan balance from growing during school.
  • Full interest-and-principle payments: Students can elect to pay the full payment amount on the loan from day one. This starts the repayment period and saves the most in interest over the life of the loan.
Eligibility Requirements
  • Must be a U.S. citizen, permanent resident, or DACA recipient over the age of 18
  • Must be enrolled full-time 
  • Must be an undergraduate student in a bachelor’s degree program at an eligible four-year, not-for-profit college
  • Meet the minimum GPA and graduation rate thresholds for borrowers and institutions depending on your class year

Best for International Students : Prodigy Finance


Prodigy Finance

Prodigy Finance

  • APR Range: 6.41% - 15.44%
  • Loan Amounts: $15,000–$220,000
  • Loan Terms: 7 - 20 years
Pros & Cons
Pros
  • Loans for graduate students studying abroad

  • Several loan and repayment terms

  • 18 supported countries

Cons
  • No co-signers available

  • Loans not available in all locations

  • 5% administrative fee added to loans

Why We Chose It

Prodigy Finance offers student loans to international graduate students who are looking to study abroad at a qualifying institution. With over 850 supported schools in 18 countries, Prodigy is a leader in international graduate school funding.

Loan options include both fixed and variable interest rates. Repayment terms are available from 84 months up to 240 months, and there is a six-month grace period on all loans.

Prodigy Finance loans are only available to graduate students, meaning undergraduate students and parents of students cannot apply. And funding requires that you are matched with a lender that approves your application and borrower profile. All loans also come with a 5% admin processing fee, which is added to the balance of your loan.

Prodigy is the best option for international graduate students looking to fund a master’s degree or another graduate program while studying abroad.

For more information, see the full Prodigy Student Loans Review.

Repayment Options
  • Deferred payment: Payment can be deferred until six months after graduation. Interest will still accrue, but no payments will be due while in school and during the grace period.
  • Full payment: Students can pay the full payment amount on the loan (principal and interest), reducing the overall interest paid. This helps students save money in the long run and pay off the loan faster.
Eligibility Requirements
  • Must be at least 18 years old
  • Must be from an eligible country, and be studying abroad in an eligible country
  • Apply to an eligible graduate degree program and college

Final Verdict

You don’t have to have perfect credit to access student loan funding. With many companies requiring relatively low credit scores, some allowing co-signers, and others looking at your academics and future potential income instead, it has never been easier to get a private student loan. But not all lenders are equal, and some charge higher rates, while others don’t offer great repayment options.

Earnest is the top lender for those with bad credit, offering very low rates, flexible repayment terms, and loans for both undergraduate and graduate students, as well as parent loans. Earnest has a more stringent evaluation process for approval, but you can qualify with less-than-stellar credit if you have a co-signer. The other lenders on our list offer more of the same, with a wide range of loan options and competitive rates in most cases. 

Comparing Student Loans for Bad Credit

Here are a few things to consider when comparing student loans for bad credit:

  • APR: The APR is what you’ll pay on top of the amount borrowed, and higher rates can cost you thousands in the long run. Find a lender with a low rate, and if possible, grab a fixed-interest loan so your rates don’t change over time.
  • Fees: Private student loan companies may have a variety of fees (origination, application, prepayment, late payment), so it’s always important to look for those. Find a lender with minimal fees to lower your overall loan costs.
  • Credit requirements: Some lenders are more upfront than others about their credit and financial requirements; look for these to help narrow down your search.
  • Co-signer availability: If you want a better chance at qualifying, finding a lender that allows co-signers can help.
  • State availability: Many lenders cover all 50 states and Washington D.C., but some are more limited.
  • Repayment options: There are many types of repayment available, and some lenders offer more options than others. Finding a lender that offers several repayment options can help you manage your payments.
  • Hardship options: Financial hardship can happen, and some lenders offer forbearance options and loan forgiveness in certain circumstances. It’s important to evaluate what options are available in the case of financial hardship.

What Is a Student Loan for Bad Credit?

A student loan for bad credit is typically a private loan that helps you pay for college but doesn’t have as stringent credit criteria as other loans. A student loan for bad credit could also allow you to have a creditworthy cosigner. A federal student loan is also an option for students with bad credit because federal loans don’t perform credit checks. 

Student loans are money borrowed from the government or a private lender to pay for college. The loan has to be paid back after graduation, along with interest. The loan can usually be used to cover tuition, room and board, books, and other school-related expenses. Student loans are different from scholarships and grants, which don’t have to be paid back.

How Does a Student Loan for Bad Credit Work?

The student loan for bad credit works the same as a regular student loan, except that you may need a cosigner or have to pay a higher interest rate because of your low FICO score. Typically, private student loan lenders base their lending decisions on your FICO score and credit history, but since most college students don’t have much credit history, they may need a parent to cosign the loan with them. 

What Is an Average Interest Rate for Student Loans?

Student loan interest rates vary and federal loans usually offer the lowest rates. While the current federal student loan rate is 3.73%, private student loan interest rates can be much higher and easily reach more than 12%. 

How Much Do Student Loans for Bad Credit Cost?

As with all student loans, you may incur some costs in the form of origination fees, prepayment fees, and late fees. However, the major cost is almost always the loan interest. This is usually paid back along with the loan principal after graduation. 

Are Private Student Loans Worth the Cost?

You should apply for federal loans first and exhaust all of your resources before applying for a private loan because they can be quite expensive. However, if you’re determined to further your education and a private loan is the only option, then it’s worth the cost. After all, it’s helping you pay for your education and a four-year experience you wouldn’t otherwise have. Additionally, college can help you qualify for a higher paying job. 

Methodology

Investopedia is dedicated to providing consumers with unbiased, comprehensive reviews of student loan lenders. We collected thousands of data points across 30 lenders—including loan types, interest rates, fees, loan amounts, and repayment terms—to ensure that we help readers make the right borrowing decision for their education needs.

Best-student-loans-for-bad-credit-4779788

Getty Images / Catherine McQueen

Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.
  1. Federal Student Aid. "Federal Interest Rates and Fees."