Charge-off on credit report and getting student loan

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Charge-off on credit report and getting student loan

Postby norah » Sun Dec 02, 2012 10:17 pm

I am an adult student, who has a charge-off on my credit report. That is, I have credit card debt that I did not pay off. Can this affect whether or not I am eligible for a student loan?
Thanks!
norah
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Re: Charge-off on credit report and getting student loan

Postby Aid Whiz » Mon Dec 10, 2012 7:20 am

This will not affect your eligibility for Federal Stafford Loans, as credit checks are not required for this type of loan. However, it may affect your eligibility for other types of student loans such as PLUS, or private student loans.

The extent to which this may hinder approval for loans depends on the lender.

For PLUS loans, credit checks are minimal and it's possible your credit may be good enough otherwise. For private loans, each lender uses a different risk assessment formula to determine eligibility, so it really depends on how each weighs this credit issue. Keep in mind that for these types of loans, you can always apply with a cosigner to increase your chances of approval.

Hope this answers your question!
Student Advocate, The Student Loan Network

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