Do I need a co-signer for a student loan?

For federal student loans, such as Perkins or Stafford, you do not need a co-signer. For private student loans, you should apply with a credit-worthy co-signer to increase your chances of approval and possibly improve the rate and fees you are offered. Some lenders require you to apply with a co-signer regardless of your income or credit rating. You’ll need to look at each loan program for these requirements. Applying with a co-signer may also help you receive a lower interest rate and better terms on your loan offer.

Most lenders will require a borrower to have a strong credit score (good to excellent) in addition to other criteria such as no negative credit history (such as missed payments), debt-to-income ratio (amount of debt vs. your current income) and even proof of current employment and income.

So, if you are an undergraduate student without sufficient personal income or credit history, you’ll almost certainly need to apply for a private student loan with a credit-worthy co-signer.

Tagged: Co-signer, Credit Score, Debt, Federal Loans, International Students, Perkins Loans, Private Loans, Stafford Loans