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You don’t need a credit score to take out federal student loans. But a good student loan credit score can help you qualify for a better rate when taking out private student loans or refinancing your student loan debt.

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For federal loans: You don’t need a credit score

One reason the federal government is involved in providing student loans is because most students don’t have a history of earnings or credit and credit scores are not required for taking out a federal student loan. But there’s no way for private lenders to evaluate how risky a loan is, or what interest rate to charge without evaluating a credit score.

Federal student loans are made directly by the government. There’s no credit check for most federal student loans — everyone taking out the same type of loan in a given year is charged the same interest rate.

The only exception is federal PLUS loans for parents and grad students. There’s no minimum credit score, but you do have a pass a basic credit check to make sure you don’t have any major issues with creditors.

Federal student loan eligibility requirements

Although your credit score is not considered when you take out federal student loans, that doesn’t mean there are no eligibility requirements. You have to attend an approved school, and the type of loans and other aid you qualify for will depend on your family’s financial situation.

Everyone who’s headed to college should fill out the Free Application for Federal Student Aid (FAFSA). It’s how you qualify not only for federal student loans, but also for “gift aid” like scholarships and grants that don’t have to be paid back.

For private loans: You’ll need a good credit score or a cosigner

Private student loans work like most other loans: A lender looks at your credit score, along with all of your existing debts and income, in order to decide how likely it is you’ll repay them. It’s hard to get approved for a private student loan if your FICO score is less than good — about 670. The higher your student loan credit score, the lower the interest rate you’ll be offered by most lenders.

Since most undergraduates haven’t established a history of earnings or credit, there’s not enough information about them on file with credit bureaus to generate a credit score. That’s why most private student loans are cosigned by a parent, other relative, or friend.

A cosigner agrees to take on the responsibility of repaying a loan if the borrower cannot, and the cosigner’s credit score is used to determine the interest rate of the loan. A cosigner with good credit can help you get a private student loan at rates that are competitive with costlier federal PLUS loans. You can use Credible to check rates with different cosigners and see which one can offer you the best rates.

LenderMin. credit score
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ascent680Ascent review
citizensNot disclosedCitizens Bank review
Not disclosedCollege Ave review
Not disclosed
Discover review
edvestinu750EDvestinU review
invested670INvested review
mefa670MEFA review
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Sallie Mae review
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SunTrust Bank review
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Student loan refinancing: You’ll need good to excellent credit

Once you leave school and enter the workforce, you’ll start building credit. Once you’ve built up good to excellent credit, you may be able to refinance your student loans at lower interest rates with a private lender.

As with private student loans, the interest rate you’ll be offered when refinancing depends on your credit score. You may be turned down for refinancing if your credit score is less than 650 to 670.

The most common reason borrowers are turned down for refinancing is that they have too much debt relative to their income. The lower your debt-to-income ratio, the better.

If you’re turned down for refinancing or aren’t offered rates that are as low as you’d been hoping for, you can try applying to some of the best student loan refinancing companies with a cosigner.

LenderMin. credit scoreLender review
advantage education loan consolidation670Advantage review
brazos student loan refinancing690Brazos review
citizens bank student loansNot disclosedCitizens Bank review
college ave student loansNot disclosedCollege Ave review
edvestinu student loan consolidation750EdvestinU review
elfi student loans680ELFI review
mefa refinancing670MEFA review
penfed purefy student loan consolidation670Penfed review
rhode island student loan authority refinancing680RISLA review
sofi refinancingNot disclosedSoFi review
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About the author
Matt Carter
Matt Carter

Matt Carter is a Credible expert on student loans. Analysis pieces he’s contributed to have been featured by CNBC, CNN Money, USA Today, The New York Times, The Wall Street Journal and The Washington Post.

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