By: Bryan Lee, UHEAA
Why do I need a cosigner?
There are a few reasons you might need a cosigner. First off, if your credit history is not strong or you don’t have a long credit history, you might need a cosigner. If you’re unemployed you will need a cosigner. Cosigners can improve the chances you’ll be approved for a student loan. Did you know that having a cosigner can actually help build your credit history?
One thing to remember is that your cosigner is legally responsible for your account.
Who can be a cosigner?
You can ask anyone to be a cosigner, as long as they have a strong credit history. Usually borrowers ask a close family member or friend that is invested in their education. Make sure you learn the specific cosigner requirements for your lender because every lender has its own requirements.
General eligibility for most lenders is pretty similar—cosigners must be 18 or older, have a good income, be creditworthy, and have the right citizenship status. If you’re not sure about your lender’s requirements contact them to get more information.
What should the cosigner do?
Both the cosigner and the student must apply together using their Social Security Number, employment information, contact details, etc. Cosigners are jointly responsible for the loan in which they’ve signed. In other words a cosigner is a person who is willing to agree to pay a borrower’s debt if she fails to repay her loan.
What makes sense?
Ultimately it boils down to a personal decision. If you need a cosigner make sure to ask the right people to be your cosigner and make sure they know their responsibilities. Before you apply for a loan use all available federal funds and if you still need more money to pay for school analyze your financial situation and make a plan for paying back your student loans.