When your learners apply for a student loan, they’re looking for resources to help them reach their goals: further education, additional skills and competitiveness in the job market, and a step toward reaching their dream careers. And at Climb Credit, we want to increase access to the tools that will help make these goals a reality. If your learners are looking for payment options and wondering how best to increase their chances of approval, here are some tips to for them to hone their applications and open the door to more student financing.
Add a student loan co-borrower
If a student doesn’t initially qualify for a Climb loan, we don’t say just “we’re sorry, but you won’t get any financing from us.” Instead, we’ll ask them to reapply with a co-borrower — someone who signs onto the loan with them and agrees to pay if they become unable. For all Climb loans, if the co-borrower is fully qualifying, so is the borrower, regardless of credit history or income. So, applying with a co-borrower greatly increases their chances of approval and even increases the chance of a lower interest rate. Your students will want to be sure, however, that both parties are fully aware of what is expected from a student loan co-borrower and what cosigning a student loan entails.
Check their credit report
Maybe a student wasn’t approved for a loan but is sure they have a good credit history. In that case, we encourage them to review their credit report. Everyone is entitled to one free credit report per year and can access theirs at annualcreditreport.com. Once they have a report, they can look to see if there are any errors. and if they do see a mistake which is adversely affecting their credit, they should reach out to the credit bureau to have the mistake corrected. Once the error is fixed, they can then reapply with a stronger credit history — which will in turn strengthen their student loan application!
But what if there’s a negative item on their credit report that isn’t an error? There may still be options for them! To remove accurate negative items from a credit report, they might be able to:
- Send a pay for delete offer to the credit bureau: They can offer to pay off the full amount in exchange for having the negative item removed. While there’s no guarantee that this will be effective, some creditors may take them up on the offer.
- Request a goodwill deletion: If they’ve already paid off the account and don’t have a payment to bargain with, they might try asking for a goodwill deletion. In this case, they’ll write a letter to the credit bureau asking for the negative reporting to be amended, describing why they were late and how they’ve since made consistently on-time payments. As with a pay for delete offer, creditors are not required to amend reports (although some may).
- Wait for the time limit to expire: If none of the above methods work, your student can simply wait for the negative items to fall off their credit report. This will take some patience, though, and may not be helpful if they need financing soon — most negative items are on a report for seven years (except for bankruptcies, which last for ten years). Fortunately, negative items carry less weight as time goes on and other, positive items are added to their report.
Have all necessary info on hand
Upon the initial application, your student will be asked to provide some information about themselves and the program they’re attending, so they’ll want to have everything they need handy. This can vary by lender, but most will ask for info such as name, address, social security number, and more. For a Climb application, they’ll need:
- First and last name
- Email address
- Home address
- Phone number
- Date of birth
- Social security number
- Program information (school name, campus, course name, start date)
- How much they want to take out in a loan
If they’re adding a co-borrower to the application, they’ll also be asked to enter the co-borrower’s personal information as well. So they should make sure to have the contact info, annual income, and social security number of their co-borrower available when they apply!
Is you student unsure of whether they have all the necessary info? They can use the checklist below to find out!
Although there’s no magic formula that guarantees every single applicant receives a student loan, following the tips above can strengthen your students’ applications and could give them the boost they need to reach that approval offer. Additionally, Climb team members are available for any advice, assistance, and information they need to help them complete a successful application.