If you're a student with little or no credit history or limited income, a cosigner may help you to qualify for this loan and potentially receive a lower interest rate.
A cosigner is someone who shares responsibility with the student borrower for repaying the loan. The cosigner doesn't have to be a relative; he or she can be any adult who meets the eligibility requirements.
Will I need a cosigner?
Most borrowers will need a cosigner for this loan to meet credit, employment, and debt-to-income requirements. Rates are typically higher without a cosigner; however, borrowers that meet these requirements on their own do not need a cosigner (but may still choose to apply with a cosigner).
Who should I ask to be a private student loan cosigner?
The cosigner doesn’t have to be a relative; he or she can be anyone who meets the requirements — ideally someone with an established credit history and steady income.
What are the cosigner's responsibilities?
The student borrower and any cosigner share responsibility for ensuring that the loan is repaid.
In the event of the death or total and permanent disability of the student borrower, the loan can be forgiven and the student borrower and any cosigner won’t be responsible for repayment.
Under what circumstances may cosigners be released from their loan responsibility?
A cosigner may be released from the loan if the student borrower is a U.S. citizen and contacts Wells Fargo to request release of the cosigner. Wells Fargo will evaluate credit and income factors to determine the student borrower’s ability to take full responsibility for repaying the loan. At the time the borrower submits a request to release the cosigner, all the following requirements must be met:
- The most recent 24 consecutive monthly payments were made on time including the first required payment or, if the first required payment was not made on time, the most recent 48 consecutive monthly payments were made on time (a payment is "on time" when it is made within the payment grace period applicable to the loan);
- No forbearances or modifications were granted for hardship reasons during the applicable consecutive monthly payment periods; and
- The student borrower meets a full credit and income evaluation.
Please note that the student borrower must submit a signed cosigner release application. To learn more about Wells Fargo cosigner release benefit eligibility or if the borrower is interested in applying for a cosigner release, please contact our office at 1-800-658-3567.
Who is responsible for paying the loan?
The borrower and the cosigner share responsibility for ensuring that the loan is repaid.
In the event of the death or total and permanent disability of the student borrower, the loan can be forgiven and the student borrower and any cosigner won't be responsible for repayment.
How does my cosigner apply?
- Be prepared to apply with your cosigner online or over the phone.
- Make sure that you and your cosigner have the required documents.
- You and your cosigner will be given instructions as to how to complete the application.
Should I choose a variable or fixed interest rate?
Variable interest rates are based on market conditions, so if market rates go up, so do your interest rate and monthly payments. Fixed interest rates stay the same over the life of the loan.
How do interest rates impact monthly payments?
In the examples below, you can see a $10, 000 loan, assuming:
- You are in school for 48 months (four years).
- First required payment will be due six months after you graduate or leave school.
- You pay back the amount borrowed plus interest in 15 years.
Monthly payment could be:
- $82.74 if variable APR is 3.40%
- $118.07 if fixed APR is 6.62%
- $155.67 if variable APR is 9.24%
How do I know what my interest rate will be?
Your interest rate will be determined by several factors when you apply, most importantly your credit history and that of your cosigner, if applicable.