In today's world, students are having to work harder and harder to find a way to afford higher education. While the costs of this education continue to rise unabated, even with the economic downturn, student's ability to pay for this college has fallen dramatically. Parental income has been decimated by the economy and students are facing double digit cost increases at most schools annually.

In the student loan world, there is essentially a divide between Federal student loans and private student loans. Federal student loans are by far the best option for students because they are, for the most part, not credit based and allow you to defer some or all of the interest until after you get out of school. The problem lies in the fact that federal student loans have an annual and a cumulative cap. What this means is that you can only borrow a certain amount each year, and then you must make up the difference yourself. Right now, for undergraduates this limit stands at approximately $31,000 for subsidized and unsubsidized loans over 4 years. With many schools costing that much per year, a large shortfall must be made up with a combination of private loans, family contributions, or other methods.

Private student loans without co-signer are extremely difficult, if not impossible to find as of 2011. The reason for this is simple. Private student loans have no government backing or guarantee, and therefore must adhere to traditional consumer credit underwriting principals. This means credit, income and residence and job stability are all going to be considered.

Because most traditional students are not old enough to have established much credit, they almost always have to rely on a co-signer to get approved for a private student loan. Even if they have established credit, if they are going to school full time, their ability to earn an income is greatly diminished, and therefore a co-signer is still going normally be required.

Given the economic downturn, many parents do not qualify as co-signers due to job or income loss, and many times even grandparents may be asked to co-sign. Additionally, if the student has derogatory credit on their credit report, they should first attempt to correct it by paying it off, and then find a suitable co-signer. Simply put, private student loans without cosigner or private student loans with bad credit are no longer an option due to the restricted credit conditions that have been in force since the economic collapse of 2008.