Finding a Cosigner For Student Loans If Your Parents Can’t or Won’t Cosign

Last Updated on December 14, 2022

When applying for private student loans, many borrowers have the luxury of asking their parents to cosign. This can mean the difference between qualifying and not qualifying for a loan in some cases, and at the very least, help the student secure a better interest rate.

But how can you find a cosigner for student loans when your parents aren’t an option? That’s a complicated question requiring a nuanced answer, so let’s look at this problem from a few different angles to get a clearer picture.

What Does a Cosigner Need to Have?

While every lender has its own specific criteria that cosigners need to meet, most require cosigners to have a solid credit history with a credit score of around 670 or higher. Again, cosigner requirements depend on the specific lender and factors like income and employment history. 

Your cosigner also needs to be employed with a steady income. If your cosigner is self-employed, they may need to provide previous tax returns to document their income. 

There is no specific age requirement to be a cosigner. The cosigner should be a legal US resident, usually a citizen or permanent resident. Lenders do not require that the cosigner be related to you or that you prove what their relationship to you is. While most cosigners are parents, the cosigner can be any adult you know.

How to Find a Cosigner for a Student Loan

If you’re wondering how to find a cosigner for a student loan, you can start by asking other relatives or adults you have a close relationship with. A foster parent, grandparent, aunt or older sibling may all be suitable candidates. The cosigner can also be a family friend, former supervisor, mentor or teacher. 

Make a list of the adults you feel comfortable asking to cosign a loan. Make sure they understand that the loan will show up on their credit report and possibly impact their ability to secure financing. 

For example, if your uncle is about to buy a house, cosigning on your student loans could affect his ability to qualify for a mortgage. That’s why it’s best to ask someone who is not planning on applying for their own loan anytime soon.

If you find someone who is willing to be a cosigner but isn’t sure they qualify, they can prequalify with the lender to determine whether they’re eligible to be a cosigner. 

While some lenders will remove a cosigner from the loan after you’ve made a certain number of on-time payments, most will require that you refinance the student loan to remove the cosigner. Make sure your cosigner understands that the loan could stay on their credit report for several years. 

If you have to take out several private student loans, you can ask different people to be your cosigner for each individual loan. You are not required to use the same person to cosign every loan. 

Avoid Online Cosigners

Students who are unsure how to find a cosigner for a student loan may think about using a third-party company that promises to deliver a credit-worthy cosigner. These companies say they can find you a cosigner, but often at a steep cost. In some cases, the service may even be fraudulent. 

According to financial aid expert Mark Kantrowitz, third-party companies usually charge a fee of around $30 or $40 to find a cosigner. The cosigner then charges their own fee, often as high as $1,000 or 20% of the loan amount, depending on their terms. 

A 2020 report from the Better Business Bureau found that some of these sites require you to pay them a fee before they find you a cosigner. Then, if they can’t find you a cosigner or if the cosigner does not respond to your queries, they won’t refund the fee.

Max Out Federal Student Loans

If you’re struggling to find a cosigner for student loans, make sure you’ve maxed out your federal student loans first. A common misconception is that federal student loans require a parent to cosign the loan, but that’s not true. 

This confusion comes because you usually need to include your parent’s information on the Free Application for Federal Student Aid (FAFSA) form. But including their information doesn’t mean your parents have to cosign the loan. 

If you haven’t filled out the FAFSA, you should give it a try before looking for private financing. Even if you don’t have your parent’s financial information, you can still complete the FAFSA to determine your eligibility for federal student loans and financial aid.

When you submit the FAFSA, your college will decide if you qualify as a dependent or independent student. If you’re a dependent student, the maximum amount you can borrow in Direct Unsubsidized Loans as an undergraduate is $31,000.

If you qualify as an independent student, then you may be eligible for up to $57,500 in Direct Unsubsidized Loans for an undergraduate degree. Independent students are those who meet one of the following criteria:

• 24 or older 
• Married
• A graduate or professional student
• A veteran or current service member
• An orphan or ward of the court
• Have legal dependents other than a spouse
• Emancipated minor
• Homeless or at risk of becoming homeless
• Having a legal guardian other than a parent

If you’re a graduate student, you can receive up to $138,500 in Direct Unsubsidized Loans without providing your parent’s information on the FAFSA. If you’ve already reached your maximum loan limit as a graduate student, you can apply for a Grad PLUS loan. The maximum annual amount available in Grad PLUS loans is the cost of attendance minus any other financial aid. 

In some cases, parents who don’t qualify as cosigners on private student loans may still be eligible for Parent PLUS loans. These are federal student loans where the parent is the main borrower and not the child. The maximum amount you can borrow for a Parent PLUS loan is the annual cost of attendance minus any other financial aid. Parent PLUS loans have fewer credit requirements than private student loans but still require a basic credit check.