How to Refinance Student Loans With A Cosigner

If you want to save money on student loan interest, learn how to refinance student loans with cosigner.

Updated by Roopsi Gupta on 10th October 2021

After a while, monthly loan and interest payments on student loans can feel depressing. Of course, student loan debt is a burden any way you look at it, but the interest rate can make it even worse. 

Perhaps you know that you’re not really getting the best possible interest rate that you can get on your student loan. That’s why so many students refinance their loans, whether it’s a private school loan refinance, or a bad credit refinance

The best way to refinance your loans? You’ll want to consider a student loan refinance with cosigner. This also includes student loan consolidation with a cosigner. Refinancing with a cosigner increases your chances of achieving a lower interest rate significantly. But, refinancing, even a refinance with cosigner, comes with risks as well. Here we’ll go through all you need to know about how to refinance a student loan with a co-signer, including how to do it, things to consider, and how to refinance student loans with cosigner release


Table of Contents


What Is a Cosigner?

A cosigner is a person that is responsible for paying back your loan if you default or otherwise cannot pay it back. Cosigners are usually someone close to a student, like a parent, grandparent, spouse, or close friend.  

Having a cosigner helps you with any loan, whether it’s a car loan, mortgage, or student loan. Lenders, including federal lenders and private lenders, see you as more credible if you have the extra support of a cosigner. It offers them peace of mind, as your loan is secured with someone else as well. Generally, it’s much easier to secure a private student loan with a cosigner than without.

Just like a lender assesses your creditworthiness, including your credit history, score, debt-to-income ratio, income, etc., they’ll do the same assessments for your cosigner. 

The stakes are high for a cosigner. If they don’t cover the loan in the event of your default, their credit score will go down as well.

Learn more: who is a cosigner?


A student high-fiving his cosigner

Student Loan Lender Requirements for Cosigners

As mentioned before, lenders will assess your cosigner just as vigorously as they assess you before offering a loan. 

Each lender has different specific requirements, but all of them tend to look at the following basic aspects of a cosigner’s application: 


    1. Credit History and Score

A credit score of 650 or above is average to good for almost all lenders. But, lenders will also be looking at your credit history, specifically how long a history the cosigner has in making solid, timely payments. Also keep in mind that if you are late on your payments, your cosigner’s credit will also be affected. 

    2. Income

Lenders will check both you and your cosigner’s income before agreeing to lend to you. If your cosigner is unemployed or otherwise strapped for cash, a lender might not be so quick to offer you a loan. 

    3. Age, Health, and Relationship

Lenders might want to ensure that a cosigner will live long enough to cover your loan payments, should you default. They will also want to know about your relationship with the cosigner, to ensure they would actually support you with payments if you needed it.  


Worried about your college tuition? Learn more about best student loans


Pros & Cons of Refinancing with a Cosigner


Student loan refinance with a cosigner can be beneficial for many students; but, it’s not the right solution for everyone. Here are some things to consider: 



Improved chance of approval

Difficult to find a cosigner

Better rates and terms

Lack of financial

Access to eligibility

Lost benefits of federal loans



  1. Improved Chance of Approval: As a student, you lack the same credit history as a cosigner who might be a bit older than you. Additionally, you likely don’t have a long history of steady income because you’re young and are a student. A cosigner offers both income and credit history to your application, which improves your chances of getting approved for the loan refinance. 
  2. Better rates and terms: A qualified cosigner may help a lender trust you more. Thus, they might be able to offer you better rates and terms.   
  3. Access to Eligibility: Many students are not eligible for student loan refinancing because they aren’t residents or citizens of the US. With a cosigner who is a citizen or permanent resident, you’re automatically eligible to apply for refinancing. 



  1. Difficulty to find a cosigner: Even if your potential cosigner is a family member or friend, asking them to take on such a huge responsibility might feel awkward. A lot of trust is involved in this relationship since your actions directly affect the cosigner. 
  2. Lack of financial independence: Until you are solely responsible for your debts, you might not feel satisfied with your independence. Relying on a cosigner is dependent in nature. So, if this financial independence matters a lot to you, you might consider exploring loans that might not require a cosigner. 
  3. Lost Benefits of Federal Loans: If you refinance your loan with a private lender, you miss out on the possibility of federal student loan forgiveness and other debt relief options. 

Person signing an agreement for a student loan refinance with cosigner

Questions to Ask Yourself Before Picking a Cosigner


Ask yourself the following questions before deciding on a cosigner:

  • Are you confident that the cosigner will be able to manage payments if you are unable to?
  • Why do you need a cosigner? Have you tried applying for refinancing without one yet?
  • What will be the consequences if you or the cosigner passes away before paying off the loan?
  • Do you have a good relationship with your cosigner?

The decision to refinance is an important one, so make sure you consider all factors and cosigner options. 

Looking to refinance your student loans? Find the best student loan refinancing lenders


How to Refinance a Student Loan With a Cosigner


So you’ve decided that you’re ready to refinance with cosigner? Awesome! Here is the process for student loan refinance with a cosigner:

1) Find a Lender that Permits Refinancing with a Cosigner

Some lenders provide options for refinancing with a cosigner, but not all.  Make sure you only look at lenders that allow borrowers to have cosigners for refinancing. 

Below is a list of private lenders who provide refinancing with cosigners:


Interest Rates


Fixed: 2.50%-6.85%

Variable: 2.83%-6.74%


Fixed: 2.25%-6.99%

Variable: 2.74%-6.74%

Laurel Road

Fixed: 2.50%-6.50%

Variable: 1.89%-5.90%


Fixed: 1.90%-5.25%

Variable: 2.49%-7.75%

PenFed Credit Union

Fixed: 2.13% – 5.25%

Variable: 2.89% – 4.78%

Nelnet Bank

Fixed: 2.48 - 6.62%

Variable: 1.95 - 5.65%

2) Find a Cosigner 

Once you have an idea of what your lender and loan will look like, it’s time to find a cosigner. Your cosigner should be someone you trust and have a good relationship with. Make sure the cosigner is aware of all the terms and conditions before signing the agreement. 

3) Shop Around

Before applying for refinancing, you will have to fill a pre-application, which will trigger a soft check on your credit score, as well as your cosigner's credit score. The pre-qualification will give you an idea about the rate you can expect on your refinanced loan. Talk to multiple lenders and do multiple pre-qualifications if necessary so that you have options. You can compare all the rates and decide on the best one. 

Most lenders have developed a calculator to help you understand your refinanced loan terms and interest rate. For example, here is Nelnet’s calculator. 

4) Apply

After the pre-check, you can fill out the final refinancing application form with your cosigner. Make sure you and your cosigner each have all the necessary documents:

  • income statements
  • proof of address 
  • government-issued ID
  • social security number
  • and more. 

5) Sign the agreement

After a lender approves you for refinancing, it’s time to sign on the dotted line! Read all the agreement terms and conditions before you and your cosigner sign the contract. 


Can I Refinance Student Loans with Cosigner Release?

Some lenders, like Citizens Bank and Earnest, offer a cosigner release to refinanced loans after certain conditions are fulfilled. Once the necessary conditions are fulfilled, a cosigner release clause releases the cosigner of his or her responsibilities within the student loan. 

For example, some lenders might offer cosigner release after you’ve made 36 consecutive repayments on your loan. 

However, some lenders don’t offer cosigner release at all. 



Frequently Asked Questions


    1. Why Do I Need a Cosigner to Refinance my Student Loans?

The main purpose of refinancing a student loan is to achieve a lower interest rate than your previous loan. Having a cosigner will improve your chance of not only approval, but also of better rates and terms. 


    2. Does Refinancing Affect My Cosigner?

Absolutely. Your cosigner is taking responsibility for the loan by acting as your cosigner, should you default. Any late payments you make will affect his or her credit score. 


    3. If You Have Bad Credit, Will a Cosigner Help?

Yes! If you have poor credit, a cosigner will help improve your chances of a refinance approval. However, if your cosigner has poor credit and/or little income, they might not be much help on your application. 


    4. Can I Refinance my Student Loans Without a Cosigner?

Certainly; however, the lender must be satisfied with your application, including your credit score and income. Some lenders specifically offer refinancing for students without cosigners though.

Frequently Asked Questions

  • 1. How does a student loan affect the cosigner?     

    As a Cosigner, he/she is also responsible for the loan and it impacts their credit score like any loan. If the borrower does not make payments then the cosigner's credit score could affect negatively.   

  • 2. How can you refinance your student loans without a cosigner?

    You can refinance student loans without a cosigner by making timely payments, building your credit scores. And find a lender who can refinance your loans to a lower interest rate

  • 3.Do all private lenders need a cosigner?   

    No, not every private lender although most require a credit check or cosigner as private student loans are credit-based and federal student loans(except PLUS loans) do not require a credit check as they are from the government.   

  • 4.Who gets the credit on a cosigned loan?   

    If you are a cosigner then the debt you signed for will appear on your credit file and  if the borrower makes all payments on time then it will be reflected positively in your credit score 

  • 5.Is Cosigner needed for refinancing?

    No, but if you have a poor credit history a cosigner is needed for refinancing your student loan else you don't need a cosigner for refinancing student loans.

  • 6. How to change cosigner on a student loan?

    First, you need to contact your lender to ask about cosigner release and most lenders will have certain requirements, just keep them ready and apply the same. When you refinance your loans you can have a different cosigner as this loan is treated as a new loan