 Although a cosigner is not necessary or required to apply for
a private student loan, a qualified cosigner may help you get approved for a
private student loan and possibly help you qualify for a better interest rate.*
Benefits of having a cosigner for your student loan
Applying for a private student loan without a cosigner is always an option;
however, you must have an established credit history and meet all of the
minimum qualifying requirements.
Be aware that applying for a private student loan without a cosigner may be more
expensive in the long run because your interest rate can end up being higher
than the one you may have received if you had a qualified cosigner.
If you have no credit history or a low credit score, a qualified cosigner may
help you get approved for a loan you would not qualify for on your own. It may
be difficult to get approved for a private student loan if you have no credit
history and no qualified cosigner.
Don’t rule out using a cosigner for your private student loan just because you
have good credit. Even with good credit, you may be able to qualify for a lower
interest rate on your private student loan with a qualified cosigner.
Responsibilities of a cosigner
Cosigners are equally responsible for paying back your private student loan. Their credit
will be affected if payments are not made on time.
Don’t forget about federal student loans – no cosigner necessary
Private student loans should be used only after exhausting federal loans, grants
and other financial aid options first. A cosigner is not necessary for federal
student loans. Federal Stafford, PLUS and consolidation loans are now available solely
from the U.S. Department of Education’s Direct Loan program. As a complement to federal loan programs,
grants and other
financial aid, private student loans can be used to pay for education-related
financial gaps.
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