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Rental scams are an all too common occurrence, costing would-be renters an estimated $12.5 billion in 2024 alone. In today’s competitive rental market, prospective tenants can be eager to sign a lease and may ignore warning signs. While scams take many different forms, any of them aim to deprive innocent victims of their money.^[1]

If you’re in the market for a new place to live, learn how to spot the signs of a rental scam.

Common Types of Rental Scams

Rental fraud can be hard to spot as common scams may use sophisticated approaches to target their victims. The people behind the scam count on renters not catching on until it’s too late and their money is gone. They also leverage the fact that the housing market can be highly competitive and many people rely on technology (such as video tours) to review options vs. turning up in person.

Here are some of the most common rental scams making the rounds. It’s worth knowing that while these scams occur on year-round leases, many are also perpetrated on short-term rentals, such as those for vacation homes or off-campus student housing.

The “Phantom” Rental: Fake Listings

Phantom rentals involve a property that doesn’t actually exist. Fake listings can look like the real thing, complete with photos and detailed descriptions of the property. As convincing as these listings may look, the property is actually made up.

This type of scam works by encouraging people to rent the property without seeing it in person. Scammers may offer excuses as to why they can’t show it to you (say, business travel or a family medical emergency), or pressure you to pay the deposit and first month’s rent to get the keys. Once you hand over the money, the scammer disappears.^[2]

The “Hijacked” Ad: Real Listings, Fake Contact

Some scammers commit rental fraud using real listings for homes, apartments, or other properties.

They’ll find a property that looks promising, copy the photos and descriptions, and use them to create a new listing. You contact the number in the listing expecting to talk to a legitimate rental agent, but you’re really talking to the scammer. Based on images and videos, you pay a deposit in good faith to the scammer, who pockets your money.^[2]

The “Bait and Switch”: Property Isn’t as Advertised

Bait and switch is a deceptive marketing tactic in which one thing is advertised but something entirely different is delivered.^[3]

With these types of rental scams, you may be wowed by photos of the property or a detailed description. You go to check it out, or even sign a lease sight unseen, only to find out that what you’re paying for and what you expected to get are two different things. The actual property doesn’t match with what you believed you were renting.

The “Payment Redirect”: Impersonating a Landlord

Some scammers will go as far as pretending to be the property’s owner to deceive people into signing fraudulent rental agreements. They may even be able to clone the landlord’s email address or payment portal to cheat people out of their money.

The most persuasive scammers convince their victims to send payment for a deposit or rent to them, without verifying that they are who they say they are. Payment redirect scams may involve multiple people working together to facilitate fraud.^[4]

How to Spot a Potential Rental Scam (Red Flags)

Some rental scams may be more obvious than others. If you want to know how to avoid rental scams, you first need to know how to recognize them. Here are some of the biggest red flags to watch out for.

The Listing Is “Too Good to Be True”

You may have a checklist of must-have and nice-to-have features that you’re looking for in a rental. If you find a listing that seems to have it all, including lower than expected rent and deposit requirements, that could hint at a scam, especially in today’s tight rental market.

Here’s a simple way to evaluate a seemingly perfect property: Compare it to similar rentals in the same market. Rental listings for a specific area often have similarities in terms of their size, features, and price. You might think you’ve hit the jackpot if you find the one outlier that surpasses the competition in every way but you may be walking into a scam.

Recommended: Cost of Living by State

Communication and Pressure Tactics

Scammers may want to close a deal with you quickly so that you don’t have a chance to spot their rental fraud. That’s where high-pressure tactics come in.

For example, the person posing as a landlord or rental agent may bombard you with calls, emails, or texts telling you that you need to jump on the property before they hand it over to someone else. Or, they may offer you a special “discount” to motivate you to hand over a deposit and first month’s rent.

If a rental situation makes you feel uncomfortable, don’t be afraid to walk away. You could be saving yourself the headache of cleaning up the mess from a scam.

Suspicious Payment Requests

Typically when you rent a place, the property owner or rental manager will ask you to pay by check, credit card, or debit card. Scammers, however, may ask for more unusual forms of payment, including:

They may also pressure you into paying upfront before you sign a lease or even see the property. Or scammers may tell you there are added fees you’ll need to pay on top of your deposit.

Lack of a Proper Screening Process

Legitimate rental agreements usually require some prescreening before you can be approved. For example, you may need to undergo a credit check or a criminal background check. You might also need to provide references from previous landlords or people you know professionally.

Lack of screening is often a giveaway that a rental opportunity is a scam. Any reputable property owner or rental agent will want to know a little bit about the person they plan to rent to.

Recommended: How Much Money Should I Spend on Rent?

Proactive Steps to Avoid Getting Scammed

Knowing how to avoid rental scams is a good thing if you don’t plan to buy a property any time soon. Here’s how to check if a rental property is legit as you look for a place to call home.

Do Your Homework: Verify Everything

A little due diligence can go a long way in avoiding rental scams. Before you hand over money or sign a lease, take time to confirm that everything is as it should be.

Asking questions can help you root out a potential scam. If the person you plan to rent from is hesitant to answer your questions, ignores them, or gets angry with you, that could signal that you’re dealing with a scammer.

The In-Person or Live Video Tour

Seeing a rental in person can clue you in to a scam if the property doesn’t match the photos or description listed online. It’s also a chance to decide if the place fits your needs, and get a feel for the neighborhood.

Ask for a live video tour if a property owner or rental agent is reluctant to let you visit or your schedule doesn’t allow you time to visit. If that request is also turned down, then you may be dealing with a scammer.

Research the Landlord and Property Ownership

If you’re worried about imposter scams, do your research on the property and its owner or owners. For instance, you should know whether you’re dealing with an individual owner, or a rental property company. Here are some other tips for researching ownership.

If people in the neighborhood seem willing to chat, ask them what they know about the property and its owner(s). People who live in the area may be the best source of information about what a rental is like and whether it’s legitimate.

The Lease Agreement and Secure Payments

At this stage, you may be ready to sign a lease and pay your deposit if everything else checks out. Before you do, take care of these steps.

Be prepared to walk away from any rental situation that doesn’t feel right.

What to Do If You Suspect or Become a Victim of a Rental Scam

You can do all the right things and still run into a rental scam; sometimes, scammers are just that good. If you think you’ve been scammed or suspect that a scam is afoot, here’s what you can do next.

Immediate Actions to Take

Protecting yourself quickly matters if you believe you’re a victim of rental fraud. Here are some important first steps to take.

The goal is to try to minimize the damage as much as possible. If you gave the scammer your Social Security number, you may also want to freeze your credit reports. Freezing your credit prevents anyone from opening new loans or credit cards in your name.^[6]

Reporting the Scam

Reporting rental scams can protect you financially and potentially help others avoid becoming victims. You can report rental fraud or gain important information from these agencies:

Document each report you make. If there’s any chance of a scammer using your personal information to commit additional fraud, your evidence can help you to defend yourself against collection claims or lawsuits related to identity theft.

Monitor Your Accounts

It’s always a good idea to track your financial accounts for suspicious activity but especially so if you’ve encountered a rental scammer. You can set up alerts for your checking accounts, savings accounts, and credit cards to notify you of new transactions, including purchases, transfers, or withdrawals.

You could also take the additional step of closing your existing bank accounts and opening new ones. You financial institution can likely help you achieve a secure banking experience if you’re in the challenging situation of enduring a rental scam.

The Takeaway

In today’s often highly competitive rental market, scammers may try to take advantage of people with fake listings, impersonation of landlords, and other fraudulent activities. It’s important to protect yourself by being aware of these ploys and proceeding carefully to verify listings and lease opportunities and use secure payment methods when drawing upon your checking account.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

FAQ

What is the single biggest red flag for a rental scam?

If a rental listing seems too good to be true, that’s often an indication that you’re dealing with a scam. If a property seems unbelievably affordable, that’s often a clue that it’s not legit. Another common sign of a scam is being subjected to high-pressure sales tactics, such as signing a lease and sending payment ASAP, before you’ve done your due diligence.

Are listings on major sites like Zillow or Apartments.com automatically safe?

While major rental listing sites typically have state-of-the-art security features, there are indeed plenty of scammers out there trying to post fake listings, hoping to trick people into paying deposits or other fees. For this reason, it’s always wise to be alert to red flags and learn how to check if a rental property is legit.

Is it normal to pay a rental application fee?

Rental companies and property owners may collect a rental application fee to cover the cost of a credit check or background check. If you’re asked for a fee, get an explanation (preferably in writing) of what it’s for. Beware of fees that seem unusually large or that the rental agent demands you pay, especially via a person-to-person payment app.

What should I do if I live out of state and can’t see the apartment in person?

If you can’t get to a rental in person for a tour, you could ask for a live video tour of the property. Alternatively, you may ask someone you know and trust who lives in the area to visit the property on your behalf. You’ll need to get the property owner or rental agent’s consent for that first.

How can I quickly verify the person I’m talking to is the real owner?

The best way to quickly verify someone’s identity is to meet them in person to discuss a rental property and ask for a government-issued photo ID. Take down their information then compare that to property tax records which can be found online for the property in question.

About the author

Rebecca Lake

Rebecca Lake has been a finance writer for nearly a decade, specializing in personal finance, investing, and small business. She is a contributor at Forbes Advisor, SmartAsset, Investopedia, The Balance, MyBankTracker, MoneyRates and CreditCards.com. Read full bio.

Photo credit: iStock/atakan

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SOBNK-Q325-070

Many students take out loans to pay for college. While federal student loans don’t require a credit check, private student loans typically do. And, since students often don’t have much credit history, they typically require a cosigner. A cosigner can be a parent, other family members, friends, or even mentors.

Since a cosigner will be responsible for paying back your loan in the event you’re unable to, it’s important to choose someone you feel comfortable entering a financial agreement with. A cosigner with good credit and high income could result in lower interest rates on your loans.

Read on for a simple, step-by-step guide on how to get someone to cosign your student loan.

How to Ask Someone to Cosign Your Private Student Loan

You may have someone in mind who would make a good student loan cosigner. The problem is, how do you ask someone to cosign a loan? It’s a big ask, and approaching the topic can be intimidating.

What follows are some tips that can help ensure you come to the conversation prepared.

1. Research Your Financial Aid Options First

Before you ask someone to cosign a private student loan, it’s a good idea to explore all of your college funding options. Around 85% of students receive some form of financial aid to pay for college.

Filling out the Free Application for Federal Student Aid, or FAFSA®, will give you access to any federal student aid you may be eligible to receive. This might include grants, work-study, federal subsidized loans, federal unsubsidized student loans, and even private scholarships. Completing the FAFSA is free, and it’ll also show potential cosigners that you’ve done your due diligence and have tapped all your available options to pay for college before asking for help.

2. Explain Why You Need a Cosigner

Once you’ve decided who you want to ask to be your cosigner, it’s important to come to the table with a clear explanation of why you need a cosigner and what costs the loan will cover. You’ll want to be prepared to share details on your own savings, debts, and credit history. This shows a cosigner why you need help and what kind of risk they would be taking on.

Providing a clear picture of what you have and what you need demonstrates that you’re taking your education and financial goals seriously. Having followed tip #1, you’ll be in a position to show the funding gap between your own funds plus any aid you’ve received and the cost of attendance at your chosen college.

3. Outline Your Plan for Repaying the Loan

When asking someone to cosign a student loan, it’s a good idea to let them know that you have a plan for repayment and exactly what that plan is. Some private lenders allow you to defer making payments until after graduation, while others require you start making interest-only payments while still in school. Either way, you’ll want to have an idea for how you will make those payments on your own.

Failing to make payments on time each month will impact both you and your cosigner, so it’s a good idea to also make a backup plan in case something doesn’t work out. This might be getting a part-time job in any field if you find that it takes longer than expected to get hired in your chosen field.

Demonstrating your plan for repayment can help build your potential cosigner’s confidence and help them feel more comfortable about entering into a cosigner agreement with you.

Recommended: 6 Strategies to Pay Off Student Loans Quickly

4. Make Sure They Understand What They’re Agreeing To

Before moving forward to a written agreement, it’s a good idea to go over the requirements and responsibilities for being a cosigner. For starters, your cosigner must meet a minimum credit score and demonstrate a certain minimum monthly income. The exact requirements will depend on the lender.

You’ll also want to let them know that, as a cosigner, they have a legal obligation to make sure the loan is repaid, and that any late or missed payments on the loan can impact both your and their credit scores.

While these risks can feel intimidating to bring up, outlining your plan to avoid loan default can help address their concerns and show you’re taking the commitment seriously.

Recommended: Does Being a Cosigner Show Up on Your Credit Report?

5. Make a Plan for a Cosigner Release

A cosigner release effectively removes a cosigner from a loan, freeing them from any continued responsibility for repayment of your loan. Private lenders may offer the option for a cosigner release if you, at a certain point down the road, meet certain credit requirements and have a strong track record of on-time payments.

Discussing a plan or timeline for when your cosigner will be released from their responsibilities shows that you’re being considerate of the risks of being a cosigner and the impact it can have on their finances. While you may not have the strongest qualifications as a borrower today, your creditworthiness can build over time as you consistently make on-time loan payments.

You might also have the option of refinancing your student loan and, in the process, releasing your cosigner from the original loan agreement.

6. Give Them Time to Think

Cosigning a loan is a serious commitment and whomever you ask may need some time to think over the decision. For this reason, it’s a good idea to approach your potential cosigner early on so you have plenty of time to talk through the agreement and, if necessary, pursue another option.

Handling Potential Concerns and Objections

Cosigners will likely have questions and potential concerns about how the agreement could impact their finances, as well as your relationship. After you’ve made your pitch, it’s important to hear them out and be open to their input to reach an agreement that works for you both.

If a cosigner has objections that you can’t resolve, it may be time to seek out a different cosigner.

Formalizing the Cosigner Agreement

If the person you ask to cosign your loan says “yes,” it’s time to find the right private student loan for your needs. It’s generally a good idea to shop around and compare rates and terms from different lenders, including banks, credit unions, and online lenders. Some lenders allow you to prequalify for a student loan online, without impacting your (or your cosigner’s) credit score. This allows you to compare offers, go over rates and terms with your cosigner, and decide which loan is the best fit.

When you officially apply for the loan, you and your cosigner will need to provide a number of financial documents to the lender, so be sure to give your cosigner time to gather all their paperwork.

Repaying the Loan Responsibly

When you take out a private student loan, you’ll typically have a choice of several repayment plans. Which one you choose can have a significant impact on both your monthly payment and total cost of the loan. Options may include:

•  Immediate repayment: This means you make full monthly payments while still in school. Doing so will minimize the interest you pay, resulting in the greatest savings.

•  Interest-only repayment: Here, you’ll pay only the interest on your loan while you’re still in school. Payments will be lower than immediate repayment, but you won’t chip away at your loan balance (or save as much on interest).

•  Partial interest repayment: This involves making a fixed monthly payment while still in school that only covers part of the interest you owe. Payments will be lower than interest-only plans, but your loan balance will grow.

•  Full deferment: Here, you’ll pay nothing while you’re enrolled in school. During this time, though, your loan balance grows.

Once you choose a plan, you’ll want to create a budget for the minimum payment you owe each month. It’s also a good idea to enroll in autopay, to ensure you never miss a payment. Some lenders also offer a rate discount if you enroll in autopay.

After you’ve graduated and your finances allow, you may be able to make extra principal-only payments — this can help lower the total interest you pay over the life of the loan.

The Takeaway

If you need a cosigner on your student loan, you have options. Whether you choose a parent, other family member, friend, or mentor, it’s important to be transparent about the requirements and risks that go into being a cosigner.

Coming to the conversation prepared can build trust and confidence with potential cosigners and put you on the path to funding your education.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

FAQ

How do you convince someone to cosign a loan?

You’ll want to be transparent, as well as fully prepared for the conversation. Explain how the loan will support your long-term educational and financial goals, how you plan to make future loan repayments, and why you are a trustworthy borrower.

Who can I ask to be my cosigner?

It’s common for students to use parents or family members as cosigners, but there are no rules stating that your cosigner must be a relative. You can also ask mentors or family friends who are invested in your success. Just keep in mind that a cosigner will need to meet the lender’s financial and credit requirements.

Can I hire someone to be a cosigner?

There are businesses that advertise online that they will cosign your student loans for a fee, but borrower beware. These are often scams in which the “cosigner” requests cash payment in advance, then disappears. Or, the business might be legitimate but will require you to give them a portion of the loan in exchange for cosigning. Generally, it’s not worth the risk or cost.

What percentage of student loans are cosigned?

Roughly 91% of undergraduate private loans are cosigned. About 43% of graduate school loans from private lenders require a cosigner.

How do I assess my creditworthiness before seeking a cosigner?

To assess your creditworthiness, you’ll want to check your credit score and take a look at your credit reports.

You can often access your credit score for free through your bank or credit card company (check your statements on log into your online account). You can access your credit reports from the three main consumer credit bureaus (Equifax®, Experian®, and TransUnion®) for free at AnnualCreditReport.com.

Photo credit: iStock/NoSystem images

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

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SOISL-Q325-018

Students who are enrolled at least half-time at an eligible school, are a U.S. citizen or eligible non-citizen, and meet other requirements can receive financial aid through the Free Application for Federal Student Aid (FAFSA®).

According to Education Data Initiative, the average cost for undergraduate students attending a four-year private nonprofit institution is $38,421 in tuition and fees per year. For students attending in-state public four year institutions, the average is $9,750 in tuition alone. Living on campus bumps these numbers up to $58,628 and $27,146 per year, respectively.

If you can’t afford to pay for this cost out-of pocket, understanding the FAFSA requirements can help you possibly fund this worthwhile expense.

What Is FAFSA?

The FAFSA is the official application form to request financial aid for higher education from the U.S. government. It determines whether undergraduate and graduate students are eligible to receive federal grants, work-study, and federal student loans. Federal aid can only be used toward qualifying college expenses.

It’s also often used by states and schools to see if you’re eligible for its student aid programs. Some private entities might also use it to determine your eligibility for their own financial aid programs.

Recommended: What Costs Does a Student Loan Cover?

How FAFSA Works

Students must complete the FAFSA before each college year. Applications must be received by the June 30 deadline. However, you can begin submitting your FAFSA for the following school year starting on October 1, and states and colleges often have earlier deadlines for state- and school-sponsored aid.

Some federal aid is granted on a first-come, first-served basis. Many of the aid programs are based on need, though some — like Direct Unsubsidized Student Loans and Direct PLUS Loans — are not.

To start, you’ll have to create a Federal Student Aid (FSA) ID online. If you’re a dependent student, one of your parents also needs to create their own FSA ID. While filling out the FAFSA, you may need to reference or submit supporting documentation, such as your Social Security number, bank account statements and tax return details, and possibly a parent’s financial paperwork, too.

After submitting the FAFSA, you’ll receive a Student Aid Report (SAR), which is an overview of the information you included on your FAFSA. Once your FAFSA is processed, you’ll receive a financial aid offer from your school. It will outline the types of federal student aid you’re eligible for, the amounts, and instructions on how to accept the award offer.

After you’ve selected the financial aid options you want to accept, the funds will be sent directly to your school. Then, your school will apply the funds to your unpaid account balance.

The FAFSA may also be used to apply for financial aid for summer classes.

FAFSA Requirements

FAFSA qualifications include academic and financial criteria. Although some federal aid programs, like the federal Pell Grant, require you to demonstrate financial need, you might still qualify for other federal aid options if you meet the remaining FAFSA eligibility requirements.

Education Requirements

The level of education you’ve completed must meet the minimum requirements to qualify for a college or career school program. This includes a high school diploma or General Education Development certificate from a state-approved school or setting.

Citizenship or Residency and Social Security Number

Another of the FAFSA eligibility requirements is that students must be a U.S. citizen or U.S. National with an active Social Security number.

Eligible non-citizen students might still be eligible for federal aid if they have:

•   A permanent resident Green Card (Form 1-551, I-151, or I-551C)

•   An arrival-departure record (I-94)

•   A T-VISA

•   Battered Immigrant Status

Be Enrolled or Accepted

Students must also be enrolled as a regular student at a degree- or certificate-granting school. To meet FAFSA qualifications for a Direct student loan, you must be enrolled at least half-time.

Maintain Satisfactory Academic Performance

Returning students who are applying for federal financial aid must maintain Satisfactory Academic Progress (SAP).

Each school determines its own SAP criteria, which includes minimum GPA, minimum passing grades for courses, number of required course credits or hours, and the timeline it deems necessary to advance toward a degree or certificate.

Age and Dependency Status

Your dependency status determines whose information you’ll need to include on your FAFSA. Dependent students are required to provide their parents’ financial information on their FAFSA while independent students might not need to.

Generally, you’re considered an independent student if at least one of the following applies to you:

•   For the school year you’re applying for aid, you’ll be 24 years old by January 1.

•   You’re married or separated (but not divorced).

•   You’re a graduate-level student.

•   You have children and provide more than half of their support.

•   You have other dependents in your household whom you provide more than half of their support.

•   You’re in the U.S. armed forces and on active duty (non-training).

•   You’re a U.S. armed forces veteran.

•   Since turning age 13, your parents were deceased, you were in foster care or a ward, or dependent on the court.

•   You’re an emancipated minor or are in a legal guardianship.

•   You’re an unaccompanied homeless or self-supporting youth at risk of homelessness.

Income Limits

A common misconception is that students or their parents must earn below a certain income to meet FAFSA eligibility requirements. However, there is not a FAFSA income limit for student applicants and their families.

Required Documents to Submit FAFSA

Although you won’t need to submit copies of additional documents with your FAFSA, you’ll need to refer to certain documents to complete your application. It may also be helpful to keep these documents on file in case your school requests to see them.

Social Security Number

You’ll need your Social Security number to include on your FAFSA form. If you’re a dependent, the form also asks for your parents’ Social Security number. If they don’t have one, enter all zeros without dashes.

W-2s and Untaxed Income Records

A main FAFSA requirement to successfully complete the application is reporting your income, and your parents’ income, if applicable. Make sure to reference all W-2s and untaxed income documentation, like interest income, child support, or other noneducation benefits.

If you are a dependent student, you’ll need to provide information from both yours and your parent’s W-2.

Tax Returns

You’ll need to reference your most current tax return information as well as your parents’ tax returns if you’re a dependent student. If you’ve already filed your tax return for the year, you might be eligible to use the IRS Data Retrieval Tool to transfer your tax information into the FAFSA.

Asset Records

You’ll also need to include your and your parents’ deposit account balances, like checking and savings, on your FAFSA. Similarly, investments, like stocks, bonds, and real estate that isn’t your primary home, must be included on your FAFSA form.

Alternatives to Federal Aid

Outside of the FAFSA application, there are other avenues to secure funds to pay for college.

Savings

Consider tapping into existing savings if your financial aid award comes up short. Doing so might help you avoid taking on more student loan debt.

There are certain accounts such as 529 savings plans that are designed to help parents and families save for their child’s education.

Grants

Research non-federal grants from your state, school, nonprofit, or other private organization. These funds don’t need to be repaid.

Scholarships

Scholarships are another aid source that doesn’t need to be repaid after leaving school. Find state-, school-, or private-sponsored scholarships to find more cash. There are online databases that aggregate information on available scholarships. Take a look to review eligibility criteria and application requirements.

Part-Time Work

If you can manage balancing schoolwork with a part-time job, earning an income while enrolled in school can help you pay your way through your education.

Private Student Loans

Private student loans are available through private lenders, like banks, credit unions, and online institutions. These loans come with varying terms and interest rates, and can help cover the gap between your cost of attendance and existing financial aid.

When comparing private student loans and federal student loans, know that private lenders aren’t required to offer the same benefits or protections as federal student loans. As a result, private student loans are generally considered an option only after other sources of financing have been exhausted.

The Takeaway

Regardless of your or your family’s income, it’s generally worth submitting an application if you meet the FAFSA requirements. Since it’s a free application, there’s nothing to lose and much to gain if you’re eligible for aid, including scholarships and grants that don’t need to be repaid.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

FAQ

How much or little income do you need to qualify for aid through FAFSA?

There are no income requirements for FAFSA applicants. Instead, a variety of factors determine whether a student is eligible for federal aid, including the school’s cost of attendance, the student’s year in school, their dependency status, family size, and more.

What is the maximum amount of money FAFSA gives?

The maximum amount of aid you can receive through the FAFSA depends on which federal aid programs you qualify for. Different programs have varying limits.

For example, the maximum Pell Grant award changes annually; for the 2025-26 award year the limit is $7,395. Direct Loans also have their own annual and aggregate borrowing limits.

How does parent income affect FAFSA aid?

Parent income that’s reported on a student’s FAFSA is used to calculate the applicant’s Student Aid Index (SAI). The SAI is a number on an index that helps schools determine your financial need if you attend its school. It also identifies your eligibility for certain financial aid programs like the Pell Grant or Direct Subsidized Loans.

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

Photo credit: iStock/Lipik1
SOISL-Q325-017

For some, tax day means a much-awaited refund. For others, it may mean another expense. There are a variety of factors that can affect your taxes, including your status as a student.

If you paid qualifying educational expenses or student loan interest during the tax year, you may qualify for a student loan interest deduction or an education tax credit — which could potentially mean a lower tax bill or a higher tax refund.

When you claim a deduction on your taxes, it is subtracted from your total income. Your income taxes are assessed after the deduction is taken. In contrast, a tax credit is subtracted from any taxes you may owe.

Taxes are complicated, so it’s a good idea to consult with a tax professional about what deductions and tax credits you may be eligible for. What follows, however, are some general guidelines on how student loans might affect your tax returns.

Student Loan Interest Deduction Explained

The student loan interest deduction lets borrowers deduct all or part of the interest they pay on their federal student loans and/or private student loans when they file their federal income tax return.

Usually, you can expect to receive a 1098-E form from each of your student loan providers by the end of January each year. This form details the amount of interest you paid over the past calendar year.

Your loan servicer is only required to send you a 1098-E form if you paid more than $600 in interest on a qualified student loan. If you did not receive this by mail, your provider may have sent an email notification to let you know your 1098-E is ready to download.

To qualify for the maximum $2,500 student loan interest deduction, you must meet certain filing and income criteria. It may be possible to deduct student loan interest that has been paid on loans issued for yourself, your spouse (if you file jointly), and your dependents. However, parents can’t claim the student loan interest deduction if the student loan is in their dependent’s name only.

Since this is an adjustment to your gross income, you can take this deduction even if you don’t itemize. In order to claim this deduction, there are certain income requirements that must be met. The deduction is phased out when an individual’s modified adjusted gross income (MAGI) reaches certain thresholds.

The threshold amounts change every year, but for the 2024 tax year, the benefit began to phase out at $80,000 for single filers and $165,000 for married taxpayers filing jointly.

The deduction was eliminated completely for single filers making $95,000 or more and for married taxpayers filing jointly who are making $195,000 or more.

Recommended: Are Student Loans Tax Deductible?

Am I Eligible for Education Tax Credits?

If you paid tuition, fees, or other education-related expenses during the tax year, you may be eligible for an education tax credit, either the American Opportunity Tax Credit (AOTC) or the Lifetime Learning Credit (LLC).

Note that you can’t claim both credits for the same individual within the same year. If you qualify for both, it might be worth calculating them both in order to determine the option that is best for you.

American Opportunity Credit

This credit applies towards 100% of the first $2,000 of eligible education expenses and 25% of the next $2,000.

What does this mean? Students who are enrolled at least half time in a degree or certificate program for one academic period during the tax year may be eligible to receive a credit of up to $2,500 for the cost of tuition, fees, and course materials.

The credit may be claimed for up to four years, but it can’t be claimed after the eligible student has completed the first four years of post-secondary education, which means those pursuing graduate degrees aren’t eligible for this tax credit.

The MAGI limit for eligibility is $90,000 for individual filers and $180,000 for joint filers. The credit is reduced if MAGI is between $80,000 and $90,000 for individual filers and between $160,000 and $180,000 for joint filers.

The AOTC is a refundable tax credit. This means that if the credit takes your tax bill to zero, you can get 40% of the unused credit, up to $1,000, as a tax refund.

Recommended: Are Forgiven Student Loans Taxed?

Lifetime Learning Credit

The lifetime learning credit (LLC) is worth 20% of the first $10,000 of eligible education expenses, for a maximum of $2,000.

The LLC is similar to the AOTC, but with a few important differences. This credit has a lower income limit than the AOTC. For the 2024 tax year, the amount of your LLC is gradually phased out if your MAGI is between $80,000 and $90,000 ($160,000 and $180,000 if you file a joint return).

You can’t claim the credit if your MAGI is $90,000 or more ($180,000 or more if you file a joint return).

There is no limit to how many years you can claim the credit. And the credit can be used to help pay for a variety of education expenses, including undergraduate, graduate, and professional degrees. You could even qualify for the credit if you’re taking classes to “acquire or improve job skills.”

Unlike the AOTC, the LLC is not refundable. This means that the credit can be used to pay for the taxes you owe, but if it surpasses that, you won’t receive any money back as a refund.

Finding Tax Help

If you want to learn more about these education tax credits and additional education tax deductions, the IRS has further information .

If the process of filing your taxes seems overwhelming or you’re still confused by the ins and outs of these tax advantages, you could consider finding help this tax season. A qualified tax professional could assist you in navigating your taxes and help you maximize your refund with less hassle — and they will know more about any credits or deductions you may be eligible for.

Recommended: Is an Employee’s Student Loan Repayment Benefit Taxed As Income?

Figuring Out How to Pay for School

Even with tax credits and deductions, paying for college might still be an overwhelming prospect.

If scholarships, federal student loans, grants, and savings aren’t enough to pay for school, you may want to consider applying for a private student loan. These are available through banks, credit unions, and online lenders. Loan limits vary by lender, but you can often get up to the total cost of attendance (which is more than you can borrow from the federal government). Interest rates may be fixed or variable and are set by the lender. Generally, borrowers (or cosigners) who have strong credit qualify for the lowest rates.

Keep in mind, though, that private loans may not offer the borrower protections — like income-based repayment plans and deferment or forbearance — that automatically come with federal student loans.

The Takeaway

Student loans can significantly affect your tax situation, from interest deductions to potential tax liabilities on forgiven debt. Understanding the federal and state tax implications is crucial for managing your financial obligations effectively.

When it comes to paying for college, most students rely on a combination of cash savings, scholarships, grants, and federal and private student loans.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

FAQ

How do student loans affect taxes?

Student loans can affect taxes through interest deductions, which can reduce your taxable income. However, loan forgiveness may be taxable, and refinancing with private lenders can disqualify you from certain benefits. Always check state-specific rules for additional tax advantages or obligations.

What is the American Opportunity Credit?

The American Opportunity Credit is a tax credit for qualified education expenses, offering up to $2,500 per eligible student. It covers the first four years of postsecondary education and is partially refundable, making it a valuable resource for reducing the financial burden of higher education.

What is the Lifetime Learning Credit (LLC)?

The Lifetime Learning Credit (LLC) is a tax credit for eligible education expenses, offering up to $2,000 per return. It applies to undergraduate, graduate, and professional degree courses, making it a flexible option for ongoing education and career development.

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SOISL-Q325-016

If you’re getting ready to apply to college, look on the bright side: It can be a good way to apply the skills you’ve learned in school to get organized and nail this project. It’s also a time to shine and show off your achievements over the past few years.

That said, like any big project, applying to college has many moving parts and can feel intimidating at times. To help you break it down, it can be wise to use a college application checklist. Doing so can help you stay on track as you move ahead with navigating the next step in your education.

What follows is just that: a college application checklist and details on how to apply to the schools you’re interested in. As you’ll see, it can all boil down to five key steps.

Tips for Getting Organized

Before you dive into your to-do list, take some time to get organized. Applying for college can definitely be complicated and time-intensive. Creating a system, including a college application checklist, can help prevent important details and dates from slipping through the cracks.

Before you start printing out forms and stashing brochures, label a folder for each school and list important information on the front, such as:

•   College name

•   Application deadline

•   Type of deadline (early decision, early action, regular decision, or rolling admission)

•   Application fee

•   Application requirements (form, essay, recommendations, etc.)

Choose a single system to monitor all submissions and deadlines, and make sure your parents can also access the information.

One method of organization could be to file the folders by deadline dates rather than school names to ensure you get all documents to each school on time.

Keep copies of important documents, such as recommendation letters and student housing information, in each folder. Most early decision or early action deadlines are in November, while regular decision applications are usually due in January.

Make a note of any schools that have extra forms or a particular department within the college that has its own set of requirements. The university likely has a list of scholarship deadlines, which may be different from its application deadline.

College application deadlines tend to be set in stone, and admission officers may even frown upon those who wait till the last minute to submit their applications. It can be helpful to set reminders on your phone, computer, or the kitchen calendar.

Schedule reminders for at least a month before the real deadline so there’s plenty of time to ask questions, make adjustments, and get your application in well before the deadline. This can help you avoid that night-before-the-deadline discovery that you are missing a form.

Consolidate tasks whenever possible. If you need a recommendation for an extracurricular activity for two different schools, don’t ask the softball coach and the band conductor. Pick one and ask for a reference letter that can be easily customized for both schools.

Even the simplest college application is typically made up of multiple forms. You can use a physical filing system or cloud-based storage to store forms, recommendation letters, and more. As you gather materials, divide everything into folders for each college and label PDFs with short, descriptive names (MusicRecommendation, not “scan008877605.pdf”).


💡 Quick Tip: Fund your education with a low-rate, no-fee SoFi private student loan that covers all school-certified costs.

College Application Checklist

Your college application checklist should look similar to what follows:

•   Create a filing system for schools organized by the application deadline

•   Set reminders for application deadlines

•   Gather test scores (SAT®, ACT®, etc.) if prospective schools require them

•   Ask for three or more letters of recommendation

•   Write personal essay (if needed)

•   Fill out the Free Application for Federal Student Aid (FAFSA®)

•   Research scholarships

1. Take Standardized Tests (Or Not)

First on your college application process checklist is to consider whether you need standardized test scores. A majority of colleges and universities no longer require standardized tests like the SAT and ACT for school applications — check with the schools you plan to apply to. If you want to play it safe and you have the time, you may want to take the test just in case.

Generally, students must register for tests about a month in advance. It will take a couple of weeks for scores to be distributed, and colleges receive scores about 10 days after students. So if your college application deadline is in January, you should schedule your test by October. Perhaps you’ll want to take it earlier if you want to give yourself enough time to retake the test if you’d like to try to get a higher score.

2. Request Letters of Recommendation

Next on your college application requirement checklist: Many colleges request two to three letters of recommendation. According to the College Board, these should be “written by someone who can describe your skills, accomplishments, and personality.” It’s wise to ask people who know you well and are enthusiastic about this prospect. Consider requesting an extra letter or two in case a recommender misses the deadline or backs out at the last minute.

When asking for a recommendation letter, keep in mind that teachers and coaches are usually very busy and likely being asked by multiple students. If possible, give them at least a month to write a reference letter. Really, the earlier the better. Some schools require recommendations from teachers in specific subjects, so be mindful of specific requirements.

3. Check for Special Deadlines

You’ll want to consider other deadlines as well, such as applications for special dorms, department-level scholarships, registering for summer activities, and more. These things can end up coloring the college experience just as much as which university you get accepted to.

In many cases, dorms are available on a first-come, first-served basis. Applying early can help you get the specific type of dorm you want, such as co-ed, separated by gender, or substance-free.

4. Fill Out the FAFSA

While you’re gathering all the information for college, you’ll probably be thinking about how to pay for college. For this item on your college admission checklist, you’ll likely want to start with the FAFSA, the form that parents and students must complete to be eligible for federal student loans and aid. Many colleges also use the FAFSA to decide if a student qualifies for its own grants and scholarships.

A university may offer both need-based and merit-based aid. Need-based aid is determined by a family’s income and circumstances, while merit-based aid is determined by academics, athletics, and other talents. The FAFSA helps colleges determine how much need-based federal aid a student qualifies for.

The FAFSA application is generally available starting in October. Try to apply as early as possible because some financial aid is awarded on a first-come, first-served basis.

A common misconception is that the FAFSA is a one-time deal. In reality, the FAFSA must be filled out every year to account for any changes in income or other circumstances. For example, if one of your parents gets laid off from their job, you might qualify for more need-based aid.

For some students, federal aid (including federal student loans) isn’t enough to cover the full cost of attendance. If that’s the case, it may be time to look into some additional sources of funding.

Recommended: Navigating Your Financial Aid Package

5. Additional Funding Options

Some families are able to fill the gap between tuition costs and student aid with savings. Parents may take out loans in their own name to help children pay for college, as well.

Other students are able to pay for a portion of their tuition with scholarships or grants. Scholarships and grants may require applicants to invest some time writing an essay or meeting other requirements. Any funds that are received can be a useful way to cover education costs since they don’t need to be repaid.

There are quite a few scholarship databases you can search to find those that fit your background and interests.

If you’ve exhausted your aid opportunities and are still looking to fill a gap, private student loans are an option to consider. While they don’t come with the same benefits as federal student loans (such as income-driven repayment plans and loan forgiveness options), they can be used to help pay for education expenses.

Unlike most federal student loans, the private student loan application process generally requires a credit check. Some students may find they need a student loan cosigner, which is someone who would be held responsible for the loan in the event the primary borrower fails to make payments.


💡 Quick Tip: Need a private student loan to cover your school bills? Because approval for a private student loan is based on creditworthiness, a cosigner may help a student get loan approval and a lower rate.

Stay Engaged in School

Once you’ve completed your college application checklist and your college applications are on their way, your last semester in high school can feel kind of pointless. Not true! Colleges will want to see those grades and know what you’ve been up to. If you’ve lost motivation, are cutting class, or let your grades slide, they’ll know it. And if you’re still taking AP exams, those results can determine whether you get credit for certain college courses.

Stay involved with your classes and send a follow-up letter listing any additional awards and achievements. This is your chance to show off what you’re capable of even when the pressure’s off.

Speaking of pressure, take time to relax — before, during, and after the application process. Plan some fun activities that don’t involve watching your inbox for acceptance letters. And congratulate yourself on making it this far.

The Takeaway

Navigating the college application process can be daunting, but with a well-organized checklist, you can stay on top of all the necessary tasks and deadlines. From gathering transcripts and standardized test scores to crafting compelling essays and securing letters of recommendation, each step plays a crucial role in presenting your best self to prospective colleges.

When it comes time to pay for college, most students rely on a combination of cash savings, grants, scholarships, federal student loans, and private student loans.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

FAQ

What are the things needed for a college application?

For a college application, you typically need transcripts, standardized test scores (if required), essays, letters of recommendation, a resume or activity list, and the completed application form. Some colleges may also require interviews or additional supplements.

Are SAT or ACT scores mandatory for college applications?

Not all colleges require SAT or ACT scores for applications. Many institutions have adopted test-optional policies, allowing students to decide whether to submit their scores. However, some schools still mandate these tests, so it’s important to check each college’s specific requirements.

When should students complete the FAFSA?

Students should complete the FAFSA as soon as possible after October 1st of the year before they plan to attend college. Early submission can maximize eligibility for financial aid, including grants and scholarships.

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SOISL-Q325-019