Who gets denied student loans?

Asked by: Wilbert Nitzsche  |  Last update: March 2, 2025
Score: 4.9/5 (4 votes)

Being denied student loans is common for would-be borrowers, and several factors could lead to loan denial. Your credit history, credit score, insufficient application information, or other issues could cause you to be rejected for a loan. If you were denied a student loan, you still have options.

What disqualifies you from getting a student loan?

If you don't meet baseline eligibility requirements, or if you've previously defaulted on a loan, you may not be approved for a federal student loan. You must maintain "satisfactory progress" in school to be approved for student loans. You can take steps to regain or improve your eligibility for student loans.

Why would someone be denied a student loan?

Lenders may look at your employment history, credit score, debt-to-income ratio, and enrollment status at your school. One of the most common reasons why a student might not qualify for a private student loan is because they don't meet their lender's FICO® Credit Score criteria.

Are student loans hard to get approved for?

Student loans are generally quite easy to get. Credit doesn't have to be that good, just not terrible either. If you've got massive debts or a recent bankruptcy, you'll get refused, but other than that, you'll be fine.

Can you be denied student loans because of bad credit?

Yes, you can get student loans with bad credit. Federal student loans don't have a minimum credit score and most don't require a credit check at all. Some private student loans are available with bad credit but can be costly without a creditworthy cosigner.

Millions have had student loans canceled under Biden — despite the collapse of his forgiveness plan

45 related questions found

What is the minimum credit score for a student loan?

Private student loans, including refinance loans, usually require a credit score of at least 670. However, knowing the precise requirements is tricky because private lenders are not always forthcoming with this information. Often, the only way to find out if you qualify is to apply.

Does Sallie Mae approve everyone?

Sallie Mae loans are subject to credit approval, identity verification, signed loan documents, and school certification. This loan is available to students at participating schools and is not intended for students pursuing a graduate degree. Student or cosigner must meet the age of majority in their state of residence.

What is the maximum student loan amount?

$57,500 for undergraduates-No more than $23,000 of this amount may be in subsidized loans. $138,500 for graduate or professional students-No more than $65,500 of this amount may be in subsidized loans. The graduate aggregate limit includes all federal loans received for undergraduate study.

What is the minimum credit score for Sallie Mae?

The average credit score for approved Sallie Mae borrowers is around 748 for undergraduate student loans. That's pretty high – but don't panic if your credit score is much lower than that. You'll need a minimum credit score (or have a cosigner with a minimum credit score) that is somewhere in the mid-600s.

Why would FAFSA be denied?

You've defaulted on an existing federal student loan. You owe a refund on any previous federal grants. You're enrolled in an academic program that makes you ineligible for funding. Your eligible noncitizen status was revoked or expired.

What can stop you from getting a student loan?

What Can Prevent You from Being Eligible for Federal Financial...
  • Not Filing the FAFSA. To receive federal financial aid, you must fill out and submit the Free Application for Federal Student Aid (FAFSA). ...
  • Certain Criminal Convictions. ...
  • Not a US Citizen or Eligible Noncitizen. ...
  • No Diploma or GED.

What disqualifies you from FAFSA?

For example, if your citizenship status changed because your visa expired or it was revoked, then you would be ineligible. Other reasons for financial aid disqualification include: Not maintaining satisfactory progress at your college or degree program. Not filling out the FAFSA each year you are enrolled in school.

Why do people get rejected for loans?

Too much monthly debt relative to your income—your debt-to-income ratio (DTI)—can lead to a lender rejecting your loan application. Low income and an unstable employment history can also prevent you from getting approved for a personal loan.

Who cannot get a student loan?

You could be denied a student loan if you lack sufficient income. Employment history: Your employment history may also be scrutinized. If you have a short work history or don't have a job, that could jeopardize your private student loan approval.

What income is too high for FAFSA?

What income is too high for FAFSA? There is no income that is too high to file a FAFSA. No matter how much you make, you can always submit a FAFSA. Eligibility for need-based financial aid increases as the cost of attendance increases, so even a wealthy student might qualify for financial aid at a higher-cost college.

Why am I getting denied for student loans?

According to the office of federal student aid, some applications can be denied because applicants did not meet the basic eligibility requirements. These include: Having demonstrated financial need for need-based federal student aid programs. Being a U.S. citizen or an eligible non-citizen.

Who is eligible for Sallie Mae student loans?

Sallie Mae offers private student loans to qualifying students who are not U.S. citizens or permanent residents (including DACA students) who reside in and attend school in the U.S. with an eligible, creditworthy cosigner (who must be a U.S. citizen or U.S. permanent resident).

What is the credit limit for student loans?

Federal student loan limits are determined by the type of loan, the student's dependency status, and the student's grade level, and past borrowing history. Dependent undergraduates may borrow up to $31,000 in federal student loans. Independent undergraduates may borrow up to $57,500 in federal student loans.

How much student loan can I get per semester?

If you're an undergraduate, the maximum combined amount of Direct Subsidized and Direct Unsubsidized Loans you can borrow each academic year is between $5,500 and $12,500, depending on your year in school and your dependency status.

What is better, subsidized or unsubsidized loans?

Which loan should I accept? Given the option, you should accept a Direct Subsidized Loan first. Then, if you still need additional financial aid to pay for college or career school, accept the Direct Unsubsidized Loan.

What is the Max Pell Grant?

The maximum Federal Pell Grant award is $7,395 for the 2024–25 award year (July 1, 2024, to June 30, 2025). your plans to attend school for a full academic year or less.

Does Sallie Mae verify income?

Credit decisions may require income verification documents. Both the customer and cosigner may need to log in to e-sign their application (time varies). Customers may delay choosing their repayment option and accepting the Loan Approval Disclosure (time varies).

What are the disadvantages of Sallie Mae?

Cons
  • Relatively high APR.
  • Sallie Mae sets repayment term length.
  • Credit check required.
  • Customer service unavailable on Saturday and Sunday.
  • Late payment fee.
  • No loan preapproval.

How much personal loan can I get on my salary?

Personal loan limits vary. The majority of lenders offer personal loans of up to $50,000, and some personal loan companies have lower limits of around $30,000. The exact amount depends primarily on your credit and financial situation, though a few lenders offer no-income personal loans.