Breakups are never easy, especially if it’s with your student loan cosigner.
When your cosigner helped you take out your first private student loan for college, you probably thought they were in it for the long haul. Now you’ve learned your cosigner is unable or unwilling to help you borrow again.
This might seem like a major setback, but you can overcome it. In fact, there are plenty of ways to pay for college, including via student loans without cosigner requirements. Here’s how you can get started.
How did you end up without a cosigner?
Student loan cosigners carry a great deal of risk.
Your cosigner agrees to be responsible for the repayment of your loan if you fail to keep it up. They also put their credit history on the line, limiting their own ability to borrow money.
That’s why it might not be wise to have your parents cosign a loan. It could harm your relationship with them or put the family’s finances at risk.
A cosigner might refuse to cosign your student loan because:
- They have a limit on the amount of debt they’re willing to cosign.
- They want to see you repay one loan before agreeing to cosign another.
- They have their own money problems.
Don’t waste time being angry. You should thank your cosigner for the previous show of support.
Your cosigner will remain a part of your previous loan agreement (or agreements). You’ll want to keep your relationship intact.
6 ways you can recover from losing your cosigner
Here are six ways you can continue paying for college even if your student loan cosigner is no longer on board.
1. Fill out the FAFSA
Without the FAFSA, you close the door on federal grants, work-study opportunities, and loans. Those options could come in handy as you overcome the loss of your cosigner.
2. Search for scholarships
You might think scholarships are reserved for high school seniors, but that’s just one of the most common myths about scholarships.
There are plenty of scholarships for college students. Prioritize applications that are meant for students of your experience level and field of study.
I won $11,000 worth of scholarships while I was attending college. I secured them because I was earning my degree in journalism while I applied for them. Here are the four sources where I found scholarship opportunities:
My school’s financial aid office
My on-campus employer
Think about how your major area of study or minor in-school accomplishments might help you score scholarships.
3. Trim your education costs
Before you consider borrowing more money without a cosigner on board, try to trim academic costs. That might offset your need for a student loan without cosigner support.
Drastic measures include transferring to a more affordable school or taking time off to save for your cost of attendance. But there also are small ways to save, such as:
- Avoiding paying hundreds of dollars for textbooks
- Saving money by living off campus
- Skipping an expensive meal plan
Despite adopting these measures, you might still need to take out student loans without cosigner support. But you’ll at least be able to lower your potential debt.
4. Reconsider your federal loan options
If you previously relied on private student loans for college, you probably had a good reason. Maybe you scored a significantly lower interest rate with a private lender, thanks to your former cosigner.
But now that you’re considering student loans without cosigner requirements, there’s no better place to look than the federal government. Direct Subsidized Loans and Direct Unsubsidized Loans for undergraduates don’t require a cosigner. You borrow the loans in your name and it’s your sole responsibility to repay them.
Federal student loans come with features a private lender likely can’t match. For example, you can switch your repayment plan for a federal loan to an income-driven repayment (IDR) plan, which limits your monthly payments to a percentage of your income, after you leave school.
5. Find a new cosigner for private loans
Perhaps you worked with a private lender in the past because you maxed out your federal student loan allotment and needed to fill in the gaps.
Whatever the case, understand that you could find a new cosigner to replace your old one. If your mom or dad cosigned your previous loan, you might consider other cosigner candidates. A grandparent or other relative could stand in this time around.
But your cosigner doesn’t have to be a family member — they could be a friend. Many private student loan companies only require your cosigner to be creditworthy and have a positive debt-to-income ratio. Ask your lender about its specific criteria before putting your next cosigner through the application process.
6. Consider student loans without cosigner support
If a private lender is best for your situation, be aware that it’s possible to take out student loans without cosigner support as an undergraduate.
Over 92% of undergraduate private student loans had a cosigner in the 2017-2018 academic year to date, according to a report from MeasureOne. That number is high because most college students don’t have the credit history and regular income to qualify for private student loans on their own.
You could be in the 7% minority, however. Not all lenders require undergraduate borrowers to have a cosigner. If you have a credit score near or above 700 and earn a regular paycheck, you could earn a private loan approval.
Ensure you understand the pros and cons of loans without cosigner support before signing on the dotted line. Without the built-in support of a cosigner, you’ll be responsible solely for repayment. So, don’t borrow more than you can repay once you leave school.
Need a student loan?Here are our top student loan lenders of 2018!
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