A federal student loan may be possible even with a troubled credit history.
Paying for college or vocational training can be tough under the best of circumstances. If you have bad credit or can't get a co-signer for a student loan, it might seem impossible to finance continued education. It is likely that a commercial student loan provider will turn you down under these conditions. However, if you have a genuine financial need and do not have a drug conviction while previously receiving federal student aid, there is a very good chance you can get a federal student loan even if you have a bankruptcy or foreclosure on your credit history.
Instructions
1. Understand how federal student loans work. Unlike commercial lenders, the Department of Education's Office of Federal Student Aid does not check an applicant's credit history or credit score. Provided you meet the eligibility requirements you can get a federal student loan no matter how bad your credit is and you will not need a co-signer.
2. Arrange to start repaying any federal student loans on which you may have defaulted. The same applies to grant money you may have received in error and must repay. You cannot receive federal student loans with either a defaulted student loan or liability for grant money on your record. However, this restriction can be waived if you arrange to start making payments.
3. Register for Selective Service before your 26th birthday if you are male. If you are already 26 or older and did not register, you cannot receive federal student aid unless you can prove you were not required to register or that you did not knowingly and willfully fail to register.
4. File a FAFSA (Free Application for Federal Student Aid). The FAFSA may be completed online at fafsa.ed.gov (see Resources below). You will need last year's tax return or W-2 forms, your Social Security number and personal records of your assets. These include your most recent bank statements and a list of investments and assets. If you are 24 years of age or less you also need the same information from your parents.
5. Select the types of financial aid you are willing to accept. Federal student aid includes both subsidized and unsubsidized student loans. You do not have to start repaying either type of loan until six months after you leave school. With a subsidized loan, the federal government pays the interest while you are in school. You are charged interest on unsubsidized loans. You may pay this as you go or have the interest added to the principal of the loan. Don't neglect to apply for any federal grants you may be eligible for. Normally you do not have to repay grant money.
6. Indicate on the FAFSA which school or schools you want your information sent after your application is processed. Make sure you do this early. You can file a FAFSA until June 30 of the current award ear, for example, June 30, 2011 for the 2010/2011 award year. However, many schools have earlier deadlines.
7. Contact the financial aid office of your school. Ask the office to consider you for all federal programs in which the school participates. You should also ask to be considered for any other aid such as scholarships or grants for which the school uses the FAFSA to determine eligibility. Some schools will do these things automatically, but not always, so remember to ask.
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