Learning & Guidance | Skyla Credit Union

Do I Need a Co-Signer for a Student Loan?

Written by Yanna | May 16, 2025 5:48:45 PM

Thinking about applying for a student loan, but unsure if you qualify on your own?

This is normal. In fact, 90.30% of undergraduate private student loans were co-signed in the academic year to date 2022/23, according to the Enterval Private Student Loan Report. That’s because many students don’t yet have the credit history, income, or financial track record lenders are looking for.

That’s where a co-signer steps in.

Whether you're gearing up for your first semester or bracing yourself for another group project where you do all the work, understanding when and why you might need a co-signer can help you borrow smarter.

here's what you'll learn 

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what is a co-signer for a student loan? 

A co-signer is someone, usually a parent, guardian, or trusted adult who agrees to be responsible for your loan with you. So, if you can’t make payments, they’re on the hook to cover it.

It’s a big favor — and a big responsibility — so it's important to choose someone who understands that.

QUICK TIP: A co-signer doesn’t have to be a parent.  It can be any creditworthy person willing to take on that commitment with you. Think of it like a financial trust fall.

 

when do you need a co-signer for a student loan?

If you’re applying for a private student loan, chances are high you’ll need a co-signer — especially if you’re fresh out of high school and don’t have a credit history or steady job yet.

Lenders use your credit score and income to decide if they can trust you to repay the loan. And if they can’t find that info (or it doesn’t meet their standards), they’ll require a co-signer to reduce their risk.

Here’s when a co-signer is usually needed:

  • You have little to no credit history
  • You don’t have a job or steady income
  • Your credit score doesn’t meet the lender’s minimum
  • You want a lower interest rate or better repayment terms

Having a co-signer helps make your application stronger — and may save you money in the long run with better loan terms.

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do federal student loans require a co-signer?

In most cases, nope! Federal student loans are designed to be more accessible. They don’t require a co-signer or a credit check (with one exception). That’s why they should usually be your first stop when looking for college funding. Here's a quick breakdown:

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 So if you're just starting out, fill out the FAFSA first before you consider private loans.
 
 
can a co-signer be denied?

Yes — and it happens more often than you might think. Even if someone wants to help, a lender can deny them as a co-signer if their credit score, debt, or income doesn’t meet the lender’s standards. Since the co-signer is agreeing to repay the loan if you don’t, the lender needs to trust that they can actually follow through.

COMMON REASONS A CO-SIGNER MIGHT BE DENIED
  • Low or poor credit score
  • High debt-to-income ratio
  • Limited credit history or recent late payments
  • Unstable employment or no income documentation
QUICK TIP: Before asking someone to co-sign, encourage them to check their credit. It’ll save time (and awkward conversations) down the road.

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benefits and risks of having a co-signer

Having a co-signer can open doors, but it also comes with real responsibility for both of you.

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QUICK TIP: If you're looking to be a co-signer, before signing, review your student’s financial habits and plans. It’s okay to ask how they’ll manage the monthly payments — after all, your credit is on the line too.

 

how to choose the right co-signer

Not everyone with good credit is the right co-signer for you. Choose someone who’s supportive — and realistic.

A good co-signer:
  • Has strong credit and stable income
  • Understands the full responsibility
  • Trusts you to manage your loan wisely
  • Is willing to help if repayment gets tough
  • Feels comfortable talking finances with you

It’s also a good idea to have a backup plan in place. Ask yourself (and your co-signer): “What happens if I can’t pay one month?” Talking through this early on avoids confusion or frustration later

 

how to ask someone to co-sign your loan?

This part might feel a bit awkward, but you can do it! Approach the conversation with honesty and have a clear plan. Here's what'll make it easier: 

  • Be honest: Share why you need help and what you've already tried. 
  • Show them you've done your homework: Talk about your budget, school expenses and repayment plan.
  • Explain and acknowledge the risk: Make it clear you understand what you're asking and take it seriously.
  • Offer them reassurance: Prove you've thought through how you'll stay on top of the loan. 
  • Offer a written agreement: This is optional but it helps build trust and sets expectations.

Here's our Co-signer Guide that can help you step by step.

tips for applying for a student loan with a co-signer

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skyla + sparrow makes this process simple

If the loan process still feels overwhelming — we’ve got you. Skyla has partnered with Sparrow, a student loan marketplace that takes the guesswork out of finding the right loan.

With Sparrow, you can:

  • Compare personalized offers from up to 13 trusted lenders
  • Get pre-qualified in minutes
  • Apply directly through the platform — with or without a co-signer
  • Choose a loan that fits your goals and your budget

 

can you remove a co-signer later? 

Yes — you don’t have to keep a co-signer on your loan forever. Once you’ve shown that you’re financially stable and responsible, most lenders offer a co-signer release option. That means your co-signer can be removed from the loan, and it’ll be yours alone. 

Here are a few ways to do it:

  • Co-signer release: After making on-time payments for a set period (usually 12 to 36 months), you can apply to have your co-signer removed. You’ll usually need to pass a credit check to qualify.
  • Refinancing: You can refinance the loan under your name only — ideally with a lower rate, once your credit improves.
  • Paying off the loan: If you’re able to knock out your balance early, your co-signer is released automatically.

Psst... not all lenders offer co-signer release...so make sure you ask this question before signing the loan. 

 

what if i can't get a co-signer for a student loan?

Not everyone has someone in their life who can — or should — co-sign. And that’s okay. You're not out of options. Try one or more of these alternatives: 

  • Apply for federal loans first: They don’t require a co-signer and often come with better protections. Check it out> 
  • Apply for scholarships and grants: That’s money you don’t need to pay back. (Check sites like Fastweb or Scholarships.com.)
  • Look into tuition payment plans: Some schools offer monthly plans that break up the cost.
  • Consider income-share agreements (ISAs): You pay back a portion of your future income instead of a fixed loan amount. Learn more>
  • Take a pause to build credit: If you wait a semester and work, you might qualify for a loan solo next term. Learn how to build your credit>
QUICK TIP: The most important thing? Don’t give up on your goals — just find the path that fits your situation. 

 

what's next?

If you're thinking, Okay, I get the co-signer thing now… but what am I supposed to actually do next? — here’s your starter pack:

Start with FAFSA

Even if you think you won’t qualify, filling out the FAFSA opens doors to federal loans, grants, and school-based aid — no co-signer needed for most of it.

Talk to someone you trust

If you think you’ll need a co-signer, don’t stress. Start the convo with a parent, guardian, or someone close who may be able (and willing) to help. Not sure how to bring it up? We’ve got a guide for that.

 

Compare your private loan options

Once you’ve explored federal aid through FAFSA, you can use Skyla + Sparrow to shop private student loans. Whether you have a co-signer or not, you can compare offers, check your rates, and find a private loan that fits your needs — all in one place, and without affecting your credit.

 

At skyla, we’re here to support your next big step.

And hey — you don’t need to have it all figured out today. The important thing is that you’re starting. Step by step, you’ll get there.