Refinance student loans

Should You Refinance Your Student Loans With a Cosigner?

refinance student loans with a cosigner

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If you’re struggling to refinance student loans on your own, you could boost your chances by applying with a cosigner. A cosigner basically reassures the lender that they’d pay back your loan if you fell behind. But choosing to refinance student loans with a cosigner isn’t an arrangement to be entered into lightly.

Before asking someone to cosign your loan, read on to learn about the risks involved. If you decide to move forward, you can check your rates with this list of the best banks to refinance student loans with a cosigner.

What is a cosigner?

A cosigner is an individual, usually a parent, family member, or spouse, who applies for a loan with you. If your credentials aren’t strong enough to qualify on your own, your cosigner’s credit and income could make your application stronger.

In fact, adding a cosigner could mean the difference between getting approved and not. A “creditworthy” cosigner could also help you qualify for the best rates.

Even though you’d be the primary borrower, the cosigner would be equally responsible for your debt. If you fall behind on your loan, for example, the lender could contact your cosigner for payments.

Because you’d be asking someone to share debt, you and your cosigner need to be on the same page about who’s responsible for repayment, as well as have a strong sense of mutual trust.

How a cosigner can boost your chances of approval

So how exactly can adding a cosigner to your application boost your chances of getting approved for student loan refinancing? Well, before lending you money, a refinancing provider wants to make sure you can pay back your loan.

They get this reassurance by checking your credit and income (or proof of a job offer). Although lenders don’t publicize a specific cutoff, most look for a credit score of 650 or higher.

If you can’t meet this criteria on your own, you could apply with a cosigner who does. Just as you provide your own information on your refinancing application, you’ll provide your cosigner’s, too.

A lender will run a credit check on both of you to make sure you meet its underwriting requirements. Even if you don’t have good credit yet, your cosigner’s strong credit could make up for it and help you get approved.

Potential risks of cosigning debt

1. Cosigner’s credit could get damaged if you make late payments

As mentioned, a cosigner becomes just as responsible for the loan as you are, even though they’re not the primary borrower.

So if you fall behind on payments, the lender could contact your cosigner to pay up. Plus, your cosigner’s credit could get damaged and this delinquent account could show up on their credit report for years.

2. Cosigner’s debt-to-income ratio could increase

Another consideration is that your cosigner’s debt-to-income (DTI) ratio could increase. Debt-to-income ratio is a measure of how much debt you have compared to how much money you make.

It doesn’t affect your life that much unless you go shopping for a loan or mortgage. Having a high DTI could mess with your chances of getting a mortgage, for instance (or at least of getting a good interest rate).

So if your cosigner is looking to borrow a personal loan, mortgage or other financial product in the near future, sharing your refinanced student loan debt might not be a good idea.

But if they’re not — and if you’re confident you can repay your loan on time — you might not need to worry too much about these potential risks.

Some lenders offer cosigner release

Some lenders now offer cosigner release, meaning they’ll remove your cosigner from your loan after a certain period of on-time payment.

Here are a few student loan refinancing lenders with cosigner release:

Although you’ll still need to apply for cosigner release and get approved, this benefit could be a nice perk that reassures you and your cosigner that they probably won’t be on the hook for your debt forever.

Best banks to refinance student loans with a cosigner

Many lenders let you refinance student loans with a cosigner, especially if you can’t qualify on your own. Here are our top picks, thanks to their competitive interest rate and flexible terms:

One notable exception at this time is refinancing provider Earnest. As of the time of writing, Earnest doesn’t have the option to refinance student loans with a cosigner.

If you’re interested in refinancing, make sure to shop around for the best rate!

Should you ask someone to cosign your loan?

Before applying to refinance student loans with a cosigner, ask yourself a few important questions:

  • Do you and your cosigner understand the consequences of sharing debt?
  • Have you had a conversation about who’s responsible for repayment? What will happen, for example, if you lose your job and need some help paying your student loan bills?
  • Does your cosigner have strong enough credit to boost your application?
  • Does your refinancing lender offer cosigner release?

If you decide that cosigning debt is too big of an ask, you can always take steps to increase your credit or stabilize your income and apply on your own in the future. According to CommonBond, most of its applicants who are rejected are able to increase their credit score and get approval within a year.

On the other hand, if you and your cosigner have talked through the details and decided it’s the right move, applying to refinance student loans with a cosigner could be the right path forward.


Want better rates? Here are the best banks to refinance student loans:

Variable rates start at...Fixed rates start at...Repayment termsWelcome bonus Check your rates
refinance student loans4.54%4.49%5 - 20 years$200Visit LendKey
refinance student loans4.99%4.47%5 - 20 years$200Visit Earnest
refinance student loans4.22%3.97%5, 7, 10, 15, and 20 years$120Visit Laurel Road
refinance student loans4.53%4.40%5 - 20 years$100 or $200, depending on the amount you refinanceVisit Credible
refinance student loans5.09%4.74%5, 7, 10, 15, and 20 years$100Visit SoFi
refinance student loans4.53%4.83%5, 7, 10, 15, and 20 years$100Visit ELFI