Cosigned, sealed, delivered

If you’re in the market for a private student loan (the kind you turn to once you’ve exhausted all your scholarships, grants, and federal funding), you’ve likely heard or will hear about cosigners. Having a cosigner can make a difference on your student loan eligibility and interest rate, so I wanted to take some time to talk about cosigners and answer your questions.

Here are a few of the basics to spark some conversation:

What exactly is a cosigner?
For private student loans a cosigner is someone who signs a loan with the student. The cosigner agrees to be responsible for the loan, along with the student. A cosigner is a person who takes on equal liability of a student loan. That means the cosigner is on the hook for any payment that the primary borrower doesn’t make.

Why do I need a cosigner?
Many college students don’t have an established credit history, so a cosigner is required to secure the funds. This makes the loan less of a risk for the lender. Even if a student has an established credit history, it may still be a good idea to apply with a cosigner. Why? Most private loans have tiered pricing. That means the interest rate is figured at a base rate (like Prime Rate Click here to learn about third-party website links or LIBOR Click here to learn about third-party website links) plus a margin. For private student loans, that margin is based on credit. So bringing on a cosigner with excellent credit can improve the terms of a borrower’s loan.

Who should I get to cosign for me?
There isn’t a standard person that must cosign a borrower’s loan. In fact, by law lenders can’t tell you who should cosign your loan. Some common choices are family members like parents or grandparents. However, you can choose a non-relative, too. As long as the person has established credit and is willing, he or she can cosign. One thing is for sure though: No matter who you choose to cosign your loan, it’s important that you have a cosigner in mind at the beginning of the process, as it will help the lender in providing you with a more timely credit decision.

Will my cosigner be liable for my loan for the whole repayment period?
Not necessarily. Some lenders offer an incentive that gives borrowers the option to release their cosigner from the liability. This cosigner release is usually an option if the borrower proves that he or she is able to repay the loan. Many lenders ask borrowers to make a certain number of on-time payments before they can take on sole responsibility of the loan. Lenders may also require the borrower to meet certain credit guidelines at the time their cosigner is released.

Now, what else are you curious about when it comes to cosigning a loan or finding someone to cosign your loan? Here’s the place to ask.

This entry was posted in Financial aid, Financial education, Preparing, Private loans, Student loans, Wells Fargo Bank. Bookmark the permalink.

134 Responses to Cosigned, sealed, delivered

  1. Anonymous says:

    what if somebody used you as a cosigner and you want out. how long does it take to remove a cosigner from the loan?

  2. Barbara Raus says:

    Anonymous, the option to release your cosigner varies from lender to lender. You’d need to check with yours to see what they require.

    While the release is an option for some borrowers, cosigners shouldn’t count on this when they agree to cosign. That agreement means taking on equal liability during the whole life of the loan.

  3. pgsenior says:

    Should Equifax report fact that my wife is not delinquent on loans and that her daughter is the one on the student loan with wife as a cosignor and daughter was late in making payments with no notification to co signor by either party.
    FICO score for wife went from 740 to 660 and one credit card has reduced her credit limit to $100 although wife had always paid total balance monthly for almost 3 years

    • Joseph Tolbert says:

      if i cosign will my credit score go down

      • Barbara Raus Barbara says:

        Hi Joseph – there are a number of elements that factor into your credit score. We’ve talked about it on the blog before, check out this post for more information: http://blogs.wellsfargo.com/StudentLoanDown/2009/03/your_credit_score_whats_in_a_n.html. Think about those criteria as you consider cosigning. Things like your total amount owed and types of credit could be affected by cosigning. Another thing to remember is that the timeliness of the payments on a new account would report to your credit as well. It’s hard to say what would happen to an individual’s score without knowing the details of the situation. There are some ways to simulate your score (there’s one linked to at the end of that post) to see what could happen if you took on an additional loan.

  4. Barbara Raus says:

    pgsenior — Your wife would need to refer back to the terms of the credit agreement. If she agreed to be equally liable for her daughter’s loan, the way it was reported would be correct. Since her daughter is not letting her know when she’s unable to make payments, your wife should see what options are available to view the statements through the lender. Some possibilities could be having the statement delivered to your address, or if possible gaining access to see the account online. You may also want to check with the lender to see what attempts were made to contact your wife and her daughter for payment. As soon as the account went delinquent there should have been notices. If Wells Fargo is the lender, go ahead and contact us through our Ask The Expert tool and we can look into the situation further.

  5. Linda says:

    What happens if the co-signer of a studen loan dies? Is the deceased person’s estate then responsible?

  6. Linda says:

    I should probably make my first comment clearer…if the co-signer is actually making the payments, and then dies, and no payments get made…can the lending agency go to the deceased co-signer’s estate for payment or can they insist on immediate payment since the co-signer is now deceased?

  7. Barbara Raus says:

    Linda — If the cosigner would pass away, the borrower needs to inform the lender. Then, generally, the lender would file a claim against the cosigner’s estate, provided there is one (This happens no matter which party was making the payments on the loan). Any funds recovered would be applied to the balance of the student loan account. The primary borrower would then be responsible for the remaining balance of the loan. If the cosigner was making the payments on the loan and the primary borrower did not begin making the required payments upon the cosigner’s death, the loan would go past due and the lender would start the collections process with the primary borrower. Also, the borrower would not be required to find someone to take over the cosigner responsibility and would instead be solely liable for the rest of the loan.

    • Doreen says:

      What if my daughters co signer passes away and the money for this year has already been approved and disbursed for the fall semester is there any thing we need to do. The money has been disbursed to the school she attends for the fall not yet for the spring my daughter is still in school.

  8. crystal says:

    what are the requirements of the cosigner? as in does the cosigner need to have good credit? or can they have bad credit? i am trying to find a co signer and i am having no luck. all say they have no credit. i need this loan so badly to make it thru the summer and get a house. So what exactly is required of a cosigner? i am making no money as i am student and they say i meet all requirements on loan i just need a co signer.

  9. Barbara Raus says:

    crystal — You’ll want someone with good credit to cosign your loan. A cosigner agrees to take on equal liability for the loan, so they need to meet all the requirements laid out by the lender. This could include things like their credit score, income, etc. By getting a cosigner with excellent credit, you may find that the terms of your loan are better. This is because when the lender determines the terms of your loan they’ll consider both your credit and the credit of your cosigner. One other thing I want to mention is that you need to make sure that you’re using the loan for approved education-related expenses. The credit agreement (promissory note) should detail what expenses you can cover with your student loan.

  10. crystal says:

    i have agirl who is 18 and will co sign but i am not sure if she will qualify. she is not working right now but is looking and has good credit. would she be ok to co sign? so are you telling me that housing is not approved for a student loan? when i talked to the lady on the phone i told her it was for getting a house and she said it was fine.

  11. Barbara Raus says:

    crystal — You’ll want to find a cosigner with a current income. Here are some things that make a good cosigner: 4-5 years of good credit history; steady employment with enough income to meet their debt obligations; all credit obligations are met; credit is not overextended; no serious derogatory items on their credit bureau report. As far as your house goes, it depends on what you mean by “get a house.” If you’re enrolled in school and need money for your living expenses, then covering rent on a house with a student loan is approved. However, if you were not enrolled in school and were trying to use a student loan to buy a house, that would not be approved. Does that make sense? So, it depends on your situation.

  12. Sharon says:

    Can a person who cosigned a student loan contact the bank and asked to be removed from the loan. The check has been sent to the student but uncahsed at the time this happened. The cosigner did not contact the student but sent a letter to the bank. The bank has contacted the student and asked him to attempt to find another cosigner. This puts the student in a hard position as he is already at school. Can the cosigner do this? Your prompt response(s) will be appreciated. He needs an answer.

    • Barbara Raus says:

      Sharon, the policy may depend on the lender. Technically if the loan was disbursed, but the check hadn’t been cashed the bank could have stopped payment on the check at the request of the cosigner. It’s very odd that the cosigner would go through the process to get the loan, signing documents, etc. to request to be removed from the loan at the last minute. Has the student been able to talk with the cosigner about the situation? If the loan is with Wells Fargo, please let us know so we can check into the specifics of the situation.

  13. This probably won't make the blog but... says:

    NEVER, NEVER, NEVER, COSIGN. The release process is a fraud. It will not happen, and no lender will show you real information on the percentage of people who comply are released!!!!

    • Barbara Raus says:

      Hi there – I wanted to give you a few more details about cosigner release options. As I mentioned in the post, the borrower will need to meet certain credit guidelines when they request to have the cosigner removed from the loan. I just wrote another post that deals with why cosigners may be needed and what borrowers should be talking about with their potential cosigners that may be helpful for this post’s readers, since cosigning should be carefully considered: http://blogs.wellsfargo.com/StudentLoanDown/2009/08/the_cosigner_conundrum.html. Since cosigners are brought on to meet the credit guidelines, to remove them requires that the borrower can meet the necessary guidelines on their own. For some borrowers, they may not be able to qualify right after they’ve made the required amount of payments. However, borrowers can ask their lender why they didn’t qualify. If the denial reason is resolved over time, borrowers can make additional requests to have their cosigner released.

  14. Jason says:

    I co-signed a student loan for a friend who had a bankruptcy on his record that was about to be removed. Almost three years have elapsed from the time the loan was disbursed until now. He has made all of the payments on time from the time he received the loan. Now I now want to be removed as the co-signer. We tried to get my name removed in January, but the loan company said he had insufficient credit. I was also told that since he was self employed that might also make things more difficult since he wasn’t steadily working. What would he need to do to get my name removed from the loan now? How much money would he need to make? How would he need to improve his credit? How else can we prove that he is able to take on the loan by himself?

    • Barbara Raus says:

      Jason – The exact qualifications will depend on the lender. Is the loan with Wells Fargo? Lenders may consider a borrower’s credit history, credit score, debt-to-income ratio, and employment stability among other things when evaluating whether the cosigner can be released. Has your friend gotten a recent credit report to know what he needs to be working on to improve his credit?

  15. Melissa D. says:

    What are the requirements that need to be met by the primary borrower in order for the co-signer to be removed from a student loan. I know this varies from institution to institution, but can you give me a general sense. How long does the primary borrower need to be working in a steady job? Does it matter how much they make in the steady job? What are the credit requirements?

    • Barbara Raus says:

      Melissa D. – Jason had a similar question right before you. As you know, it will vary from lender to lender, but may include credit history, credit score and debt-to-income ratio among other things. So, yes, the amount of money the borrower makes may be a factor as it could be considered in relation to the amount of debt the borrower has. A good cosigner is someone who: has good credit history, has steady employment with enough income to meet their debt obligations, meets all credit obligations, has not overextended his/her credit, and has no serious derogatory items on their credit bureau report. To have the loan without a cosigner much of the same is usually expected of the primary borrower.

  16. Paul says:

    What are the requirements to be removed as a cosigner from a regular Sallie Mae student loan? All I can find on their website is that it’s at the discretion of Sallie Mae.

    • Barbara Raus says:

      Paul – You’d have to contact Sallie Mae directly to get more information on their requirements. Those will vary from lender to lender. They should be able to give you guidance on what requirements the primary borrower needs to meet in order to release their cosigner. As I told earlier commenters, those may include credit history, credit score and debt-to-income ratio among other things.

  17. Am says:

    Being a cosigner when does it become an issue when the primary borrower has a job, married w/income, and refuses to inform the cosigner that they have income but will not pay or consider taking over the payment. After Filing bankruptcy the student loans have went into default. What should I do?

    • Barbara Raus says:

      Hi Am – If the primary borrower stops making payments and the account becomes past due the loan would report to the credit agencies as such for both the primary borrower and the cosigner. The best thing a cosigner can do to protect their credit in the situation you described is to make the payments to the loan. Otherwise the cosigner’s credit may be affected negatively.

  18. Elena says:

    What happens if the borrower intentionally, out of spite, does not want to release a cosigner that was once his mother in law? Mother in law at this time is retired and not working. How can she as a cosigner protect herself? The period in which he may have released her has been up since last summer, but he is not moving forward with it. He has a steady job, is making good money, and it is my understanding that has been making minimal payments toward the loan, but suppose he decides he is not going to pay anymore. Exactly what affect or consequences will this have on the ex mother in law who obviously will not be paying for the loan?

    • Barbara Raus says:

      Elena – The cosigner can get it touch with the lender to see if she can initiate the cosigner release process, but eventually the lender will need the primary borrower’s cooperation as well. In this situation, the cosigner needs to remember that so long as her name is on the loan any activity that happens will affect her credit as well as the primary borrower’s credit. So long as the primary borrower is making the required payments it will report as such. The cosigner should check with the lender to see if there are any options to keep track of the loan either through statements or online access. That way if the primary borrower should stop making payments, the cosigner can step in before the loan reports negatively toward her credit. Should the loan become delinquent, any collections activity would likely target both the primary borrower and the cosigner.

  19. Paul says:

    I am a cosigner on a student loan. If the primary were to get a deferment on the loan due to temporary hardship would the payment automatically be due from me as the cosigner? Would the same be true if I as the cosigner got a deferment for the same reason? For instance, if I were to be out of work and I had to defer payments on my loans and the person I cosigned for decided not to submit their payment on time, would it effect my credit if I had a deferment on that loan? Would I even be eligible to get a deferment as a cosigner?

    • Barbara Raus says:

      Hi Paul – In approved periods of deferment or forbearance payments would not be required from the borrower or the cosigner. To qualify for a deferment or forbearance the primary borrower, not the cosigner, must meet certain requirements. As far as credit is concerned, the loan activity reports for both the primary borrower and the cosigner. If the loan was in a deferment or forbearance, it would report as not requiring payments.

  20. Jane says:

    My boyfriend cosigned on a student loan for his ex-fiance when they were together. She refuses to get a job and step up to her obligation (she never finished school either), and my boyfriend really doesn’t have the money to spare to take on her debts when she’s perfectly capable of obtaining work. She has recently married a military man. What can be done besides the obvious of paying this ourselves? Is there any way of a release or could she and her husband refinance the loans to where he’ll be the cosigner? Sadly, I’m not sure he’s credit-worthy though. My boyfriend has since learned his lessons about cosigning.

    • Barbara Raus says:

      Jane – If your boyfriend’s ex-fiancée is willing to consolidate the private loan with a private consolidation loan, she could do so with another cosigner freeing your boyfriend of the responsibility. However, if she can’t find a cosigner with good credit or if her own credit prohibits her from securing that type of loan it wouldn’t be an option. Does the loan have a cosigner release option? While that wouldn’t be an immediate solution as someone would need to continue making payments for the required amount of time, it does mean that your boyfriend could be released from his responsibility. Keep in mind, though, that cosigner release would still require cooperation from the primary borrower as they would need to be able to qualify for the loan on their own before the cosigner could be released. It’s important that he protects his credit while he’s jointly responsible for the loan. Any activity will be reported to credit agencies for both the borrower and cosigner.

  21. Sheldon S says:

    How exactly is the cosign suppose to “cosign” a loan online?? After I filled out the app for a loan I knew wasn’t going to get approved on because I have no or bad credit, I finally got the application number and gave it to my mom to cosign. After she hit submit, the website said that the app didn’t need a cosigner. What is going on??

    And yes, I clicked the choice that asked if I was going to apply with a cosigner

    • Barbara Raus says:

      Hi Sheldon – I’d recommend that you first check the status of your application through Borrower Online Access (https://wfefs.wellsfargo.com/boa/) There you’ll be able to see if your loan needs a cosigner. Know that there are some situations where a borrower isn’t able to qualify even with a creditworthy cosigner due to their own credit situation.

  22. Anomynous says:

    I have a possible co-signer, but before this person commits, there is the question of “Is there some insurance that the co-signer will NOT be liable if the Borrower was to be hurt or killed in an accident?” therefore unable to pay off the loan?

    • Barbara Raus says:

      Hi Anonymous – When someone cosigns a private student loan they become equally liable for the debt. If something should happen to the student that is still the case. If the primary borrower should die, a claim would be put on their estate and any remainder on the loan would be the cosigner’s responsibility. Folks have written to us in the past with similar questions and some were looking into a life insurance policy for the primary borrower. Perhaps that’s an option to pursue that could ease your cosigner’s mind.

  23. dc says:

    my son has passed away 14 months ago. i co-signed a personal student loan for him. now i have the bank and credit company coming after me i really dont no what to do is there anything i can do. i can not pay this all back by myself i am just making now with my own bills which i pay on time. not with just my lost of my son i am trying to deal with i have this now hanging over me. if anyone has any idea for me please let me no. i even tried to ask for a loan forgivness because he is not here to help me pay for this.

    • Barbara Raus Barbara says:

      dc – I’m sorry to hear about the loss of your son. If he had any federal student loan debt, that should’ve been discharged upon his death. For any private student loan debt, you should refer back to the terms of the promissory note or credit agreement. As a cosigner on the loan, you may have agreed to be equally liable, thus any balance that remains on the loan would be your responsibility. Generally, lenders first seek to secure the remaining balance by filing a claim with the borrower’s estate, if there is one. It sounds like you’ve been in contact with the lender; they may be able to offer a more flexible payment option, given your situation.

  24. Unknown says:

    When I co-signed for my daughter’s student loan, I was employed, now I’m retired with very little income. My daughter can’t find a job. What can I do to remove my name out the loan?

    • Barbara Raus Barbara says:

      Unknown – There are a couple options that you could look into. First off, check to see if your daughter’s student loan has a cosigner release option. Sometimes a lender will release the cosigner from their liability after the borrower makes a certain number of on-time payments. If you’re looking for something more immediate, your daughter could consolidate her loan with a private consolidation loan. She may still need a cosigner in order to qualify, but it wouldn’t have to be you.

  25. Jaime says:

    My mom has co-signed for 2 of my private student loans. I am currently still in school so the loans are in deferment right now. Situations have changed for my mom and she is considering bankruptcy. I know that I, the borrower, can not discharge student loans in bankruptcy, but was wondering if that is the case for co-signor’s as well. If she is unable to discharge them, is there anything different with filing bankruptcy as a cosignor? I ask because I have filed for bankruptcy about 3 years ago and my loans were reaffirmed and all is well today however she spoke with an attorney today who suggested she pay off my loans in order to be able to file bankruptcy. This doesn’t sound right to me. Are the rules more strict for cosignors? Thanks in advance for any help.

    I would also like to add that I have all intentions on paying my own loans, and am not looking at this as a way for me to not pay but I don’t want my mom to be penalized just for co-signing.

    • Barbara Raus Barbara says:

      Hi Jaime – The borrower and cosigner are equally responsible for the loan, so generally the rules that prevent you from discharging the loan in bankruptcy would also apply to your mom. I don’t know the details of you mom’s situation, however, it may be different than when you filed and she should consult a qualified bankruptcy attorney to discuss the situation.

  26. K says:

    Hi! Can my mom cosign for me if she has excellent credit but no income (my dad works but she doesn’t think he will want to cosign the loan)? What do you think my chances are to get approved in that sitation? I am an independent student, but due to medical problems, I became unemployed for a while & was forced to declare chapter 7 about 2 years ago. It stinks that I don’t qualify on my own, and I hate relying on my parents…but I need to get back to school and this is the only way I can do it right now. Thanks!

    • Barbara Raus Barbara says:

      K – Lenders take a number of things into consideration when deciding a borrower’s eligibility. In addition to credit a certain debt to income ratio is usually required, so that could be an issue if your mother doesn’t have an income. You’d have to go through the process to see whether or not you could qualify with her as a cosigner. Another thing to consider if borrowing isn’t an option is whether or not your school offers a tuition payment plan. That could be a way to get back to school and pay as you go.

  27. jody says:

    im trying to get my grandpa ro cosign my student loan. he has a 620 credit score but an outstanding income. over 100,000. would he qualify to cosign my loan?

    • Barbara Raus Barbara says:

      jody – Depending on the lender a number of things play into who qualifies to cosign a loan. You’d have to apply with him to know for sure, but know that credit score and debt to income ratio are usually two of the qualifications.

  28. AC says:

    My mother cosigned a private student loan of less than 7,000 dollars and a year or so later she declared bankruptcy, the loan went into collections—my mother no longer has the original prom. note and I requested but never received a copy from the lender. I am still in school full-time and was not given the option to find a replacement cosigner or even to start making the payments myself— the situation was totally out of my control and it seems strange that the cosigners bankruptcy would cause the loan to go into default without first giving the primary borrower a chance to work it out, especially since as a student there is no money to be had and it seems counterintuitive. Is this how it is for anyone who has a cosigner who declares bankruptcy?

    • Caroline Hanson Caroline says:

      AC – Thanks for your question. Based on the information you have provided, it sounds as though you had a loan that required immediate repayment (or that you had used all the time allotted on a deferred payment loan). In that case, since you, the borrower, were not contacted it’s most likely the cosigner filed a Chapter 13 bankruptcy. A Chapter 13 bankruptcy ceases contact to all parties to the loan by Federal bankruptcy law for cosigner automatic stay.

      Regarding a replacement cosigner—this is not an option, as you would have to apply for a new loan to pay off the old one since the terms were based on credit of the applicants.

  29. Theresa says:

    I co-signed a student loan for someone four years ago. This loan was through Sallie Mae and it has come to my attention recently that the primary borrower has filed for bankruptcy. If the bankruptcy goes through would that mean that I would be obligated to pay the balance on the loan or would the bankruptcy negate everything and neither he or I would need to pay back the loan?

    • Caroline Hanson Caroline says:

      Hi Theresa – If the loan is dischargeable through bankruptcy, you, as the cosigner, would remain the sole person responsible for the loan. If the loan is non dischargeable in bankruptcy, the student/borrower and you as the cosigner will remain liable for the loan.

  30. M. says:

    I have bad credit but my dad is willing to cosign for me and he has excellent excellent credit. I have tried to get approved with him but sallie mae denied me. Are there any lenders that offer student loans for people in my situation?

    • Barbara Raus Barbara says:

      Hey M. – There are times when a borrower’s credit excludes them from qualifying for a private student loan even with a cosigner who has excellent credit. But there are other student loan options for your dad to consider. He could apply for a Federal PLUS loan for parents through the Direct Loan program. Wells Fargo also has a loan that parents or sponsors can take out in their own name to fund a student’s costs. Check out the details here: https://www.wellsfargo.com/student/loans/parent/privatestudentloans.

  31. Helena says:

    I consigned a student loan for a friend a few years ago. I just found out recently that he filed for bankruptcy. If the bankruptcy goes through would I be responsible for paying back the balance owed on the loan?

    • Barbara Raus Barbara says:

      Helena – If the loan is dischargeable through bankruptcy the cosigner remains liable for the loan and then would be solely liable. However, if the loan is not dischargeable through bankruptcy the primary borrower and cosigner remain liable for the loan.

  32. Iris says:

    I have bad credit and need to take a private student loan. Can my fiance, who makes about 70,000/yr and has been at his job for a couple of years, but has no real credit (doesn’t like debt) be a cosigner for me?

    • Barbara Raus Barbara says:

      Iris –it’s possible. Credit history is just one thing that lenders look at when considering whether to approve a cosigner. Your fiancé may have a good credit history, even if he’s never taken on significant debt. He should check to see if he has a credit report. If he pays his bills on time and has a credit card that he uses occasionally, he may have a solid credit rating. However, if he really has no established credit, than you may have to seek out another cosigner. You can find more information about cosigners by visiting wellsfargo.com/student and clicking on the Student Center.

  33. Too easy to get burnt says:

    I hope that the discussions on cosigners are for students just out of high school. I am sorry, but I wholeheartedly disagree with anyone who wants to cosign for an adult (I mean someone out in the workforce for over 10 years and older than 30) to further his/her education. If an adult cannot get a loan on his/her own, then go to school part time and work part time. My parents made this mistake and have regretted it – private student loans never go away.

    • Barbara Raus Barbara says:

      Too easy – Generally when we’re talking about cosigning it is for a traditional college student just out of high school. For those young borrowers with no established credit, a cosigner is usually necessary. But there are situations where other students who aren’t able to qualify on their own need a cosigner. Thanks for sharing your perspective.

  34. daniel says:

    my nephew wants to apply for a student loan consolidation loan. My mother was co-signer on the loans to be consolidated and he wants her to co sign again on the new loans. Obviously she is now older, retired, etc. What happens if she co signs and then passes away. Will the bank expect her estate to pay off the loans?

    • Barbara Raus Barbara says:

      Hi Daniel – If the cosigner would pass away, the borrower needs to inform the lender. Because the cosigner is equally liable for the debt, the lender would generally file a claim against the cosigner’s estate, provided there is one. Any funds recovered would be applied to the balance of the student loan account. The primary borrower would then be responsible for the remaining balance of the loan.

  35. Paige Zeta says:

    My mother cosigned on her niece’s non-Federal student loan. My mother passed away recently. My mother’s niece’s student loan payments are not scheduled to start until 2014. My mom’s niece thinks she can just not start paying off her loan in 2014 and my mom’s estate will have to pay for her loans. Do the heirs to my mother’s estate need to hold out the amount of loan until 2014 to see if her niece pays the loan or not?

    • Barbara Raus Barbara says:

      Hi Paige – I’m sorry to hear about your loss. When a cosigner passes away the borrower needs to contact the lender to inform them since the cosigner was equally liable for the debt. The lender may file a claim against the estate if there is one. I’d recommend contacting a lawyer who specializes in estate matters. The lawyer will likely charge you a fee for the advice, but it may be worth it in the long run to get this straightened out.

  36. millie says:

    if i filed chapter 13 as a cosigner on my son’ student loans and he had a judgement and garnishment am i still liable for that loan

    • Caroline Hanson Caroline says:

      millie – In most situations student loans are not able to be discharged in bankruptcy. Once the applicable debts have been discharged, if the bankruptcy plan did not discharge the student loan both of you remain equally liable for the debt.

  37. steve says:

    My Aunt cosigned for my student loan in 2006, apparently she filed for bankruptcy in 2009 without telling anyone. nobody knew anything was out of the ordinary until i received a phone call from debt collectors just 2 months ago saying i owed the full amount of the loan (plus interest and fees) immediately. i am still a full time student and worker and was never informed my loan had been put into default or asked for a payment of any sort.

    My aunt also cosigned for two other loans that started through the exact same company and nothing has or will be affected by this bankruptcy, i called and checked.

    So in all, she cosigned for 3 loans of mine through the same company, apparently this first one was sold without my knowledge or consent and now this is one is the one causing all this chaos.

    The debt collectors are giving me these ridiculous payment plans of a minimum of $1000 per month or a settlement of $20000 immediately and the company that bought this loan refuses to talk to me because they sold of my defaulted loan (which is was never told about) to these debt collectors, i have an attorney and paralegal trying to get stuff done but it has gone nowhere in a month. What should i do?

    Can i sue my aunt (which i really do not want to because she is family and feels horrible about all of this)? Can the debt collectrs garnish my wages until the loan that is in default is paid? Why is only one of these loans in this situation if all the original paperwork was the same? Can i take the debt collectors to court? Can i take the original or secondary loan buyer to court?

    I am sorry for how long this is, but i am still in school with a full time job as well trying to make things work and i have no idea what to do or where to go with this.

    • Barbara Raus Barbara says:

      Steve – without knowing the complete details of the situation, I can make some assumptions about what happened. When a borrower files bankruptcy, an automatic stay is put on their debts. This means that creditors can’t contact the borrower for payment, etc. Did your loan go into repayment while you were in school? If that was the case, the lender probably was prevented from contacting you because of this automatic stay triggered by your cosigner’s bankruptcy filing. Your lawyer will be able to provide more details about what legal options are available for you.

  38. Raine says:

    If I co-signed on a small loan for someone and they are in default. Am I responsible for any prior loans that they took out without me co-signing? Should the credit rating company tag me for the total amount owed by the student whereas I only signed for 3000?

    • Barbara Raus Barbara says:

      Raine – the only amount reported to the credit agencies should be the amount that you are also liable for – the loan that you cosigned. Have you contacted the lender to ask about what they are reporting? It may be a reporting error that is having the entire balance showing on your credit report.

  39. RAINE says:

    Am I responsible for the total amount owed by the student? I only co-signed 3000 and the experian is tagging me for the total amount owed by the student which is excessive. I was not aware of any prior debt and was definitely not a co-signor!

  40. Tiara says:

    Hi I was wondering if I’d still get approved for a student loan if my mom cosigns. She claims her credit isn’t good because of all the bills and I have no credit cause I’m just starting out. My ability to attend school depends on getting this loan. What are my options?

    • Barbara Raus Barbara says:

      @Tiara – You’d need to actually apply in order to find out if you were approved with your mom as cosigner. Generally, lenders look for a cosigner with a good credit history among other factors.Thanks for your comment!

  41. Belinda says:

    How can I get more financial help while working toward a degree. I have already done my FASA and maybe eligible for 5,000, my course will be1,300 each class, 3 classes $260. A quarter, each 6 weeks. This is all new to me and I really needs answer? I trying asking the administration of the university, but they fast talk, and I don’t like to keep asking them to repeat. I don’t want to get a loaned really not at this time . Is there other grants that may help me until I get a job

    • Barbara Raus Barbara says:

      Hi Belinda – First off, don’t feel bad about asking questions. Those folks in your financial aid office are there to help you though the process. They want you to understand you financial aid situation, so make sure you are getting all the answers you need to be informed. Your school can also help you find any alternative options to finance any gap that your current aid won’t cover – whether it be grants, scholarship, work study or other student loans.

  42. brenda garcia says:

    hi barbara,

    I have bad credit score around 560′s and i am the process of paying of my past debt of about 1100 total from 3 different places. I called wells fargo for student loan because i just got accepted into my dream program “dental hygiene” and i was told even with the cosigner you will not get approved because of your credit. Do you think paying my debt off will improve my chances of getting loan for my semester in august. I am really worried and I should be done paying off my debt by end of this month june 30th. What would be your recommendations? or suggestions that can help me improve my credit fast and increase my chance of getting loan approved with cosigner. Please help me i do really need help in what should i do because i worked so hard to get into this program and i am worried that me not getting loan would end my dream.

    • Barbara Raus Barbara says:

      Brenda – Unfortunately some borrowers do find that their credit prevents them from qualifying even with a cosigner. I’m glad to hear that you’re working on paying down your debt. Remember that your credit takes into a number of different factors including payment history, total accounts, age of accounts, and debt usage. You might want to pull your credit report to see what is affecting your score. That will help you as you try to get your credit back on track. Depending on your history, rebuilding your credit may take some time. Meantime, there are other options to pay for school that you could look into for the fall. First off, remember to file a FAFSA and see what federal aid including scholarships and grants you qualify for. If you need more money, there are some private student loans that let someone borrow for the benefit of the student. So if you had a cosigner willing to take on the debt in their name you could be able to fund any remaining costs that way. Check out more details on that option here: https://www.wellsfargo.com/student/loans/parent/privatestudentloans

  43. Chelsea says:

    I got a student loan for my first year of college through Wells Fargo. My grandmother cosigned on the loan. Can I continue that loan over to my sophomore year of college to pay for it?

    • Barbara Raus Barbara says:

      Hi Chelsea – Thanks for your comment! Generally loans cover one term of education costs—that’s how schools and lenders determine how much you need. So if you need to cover additional expenses this year, you’d need to apply for another student loan. I hope that answers your question!

  44. Ryan says:

    I am trying to get a private loan but the only person i have to co sign is my dad and he only has a credit score of 611 and i have no credit at all. Do you think there is a chance i can still get approved ?

  45. mel says:

    I got approved for the collegiate loan, but I dont think anyone in my family wants to sign it. Is there anyway I can be the cosigner myself? My family does not make that much money

    • Barbara Raus Barbara says:

      Mel – you’d need someone separate to cosign your loan, but remember that your cosigner doesn’t need to be someone in your family. Any person with good credit who is willing can cosign your loan.

  46. Brandi says:

    What does “credit eliligible, pending documentary review” mean? Have I been approved and all you need is proof of enrollment?

    • Barbara Raus Barbara says:

      Brandi – the document review is where we may request copies of certain documents to verify the information you provided on your application such as proof of income. So based on the information you provided, you’re eligible for the student loan, we just need to confirm the details.

  47. traci says:

    My father cosigned a student loan for my cousin. He passed away a couple of months ago. She doesn’t graduate from school until December, therefore nothing has been paid on the loan yet. What will happen with this loan? Will the estate have to pay it, can she get a new cosignor, or can she just pay it when it becomes due like she would have if he were still alive? I can’t find any answers, so any help would be greatly appreciated!!

    • Barbara Raus Barbara says:

      Traci – I’m sorry about your father. When a cosigner passes away, the primary borrower needs to let the lender know. The lender may file a claim against the estate. Generally then the primary borrower would be responsible for repaying the remainder of the balance, after any payment from the cosigner’s estate, on the regular repayment schedule. Usually a new cosigner would not be required. Let us know if you have questions.

  48. Traci says:

    My dad cosigned a loan for my cousin. He has recently passed away. She doesn’t graduate until December, therefore no payments have been made yet. What will happen with this loan? Will the estate have to pay it, or can she pay it after she gets out of school like she would if he was still alive? Needing advice desperately!!

  49. traci says:

    My dad cosigned a loan for my cousin. He has recently passed away. She doesn’t graduate until December, therefore no payments have been made yet. What will happen with this loan? Will the estate have to pay it, or can she pay it after she gets out of school like she would if he was still alive? Needing advice desperately!!

  50. Heather says:

    My grandmother had me sign her name to my loan application because she lives 13 hrs away. The loan company has spoke with her several times. They actually had to speak with her to approve the loan since i applied online. She has made payments over the last 5 years when I was unable to. She has received bills. I am now having major financial troubles and she wants off the loans. She is now saying that I committed fraud and she didnt approve of the loans. My question is how can it be fraud if she knew about the loans and has made payments and dealt with the company for years? Is it fraud? I didnt realize I was doing anything illegal since she knew and gave me permission.

    • Barbara Raus Barbara says:

      Hi Heather – Each lender has their own process for determining when fraud has occurred. I’d recommend contacting your lender to discuss how they evaluate claims of fraud and talk through your own situation in more detail.

  51. MLopez says:

    Can someone who is retired cosign a student loan?

  52. Kali Lake says:

    Melissa I totally feel your pain. I stupidly consolidated years ago when the interest rate was 7.75%. I had lots of credit problems at the time because I didn’t have a clue as to how to handle money. I really wish they’d taught me that before I agreed to a $40K loan. Here I am 10 years later and hovering at $30K (also paying about $350/mo). Ridiculous. No re-consolidation options for me, too, though my credit’s great now and I know I could do a personal loan. But I think that it would a) hurt my credit score and b) not be any cheaper. Any thoughts are so very welcome!

  53. Jen says:

    My step father (has terminal cancer and was given 6-24 months to live) and has been married to my mom for 11 years. He just cosigned a loan (not sure if federal or private or how much) with his step daughter because she has horrible credit and has defaulted on her home payments and is now short sale but will be sold for 50-60K less than what is owed and keeps getting fired. The loan was for the grand daughter who is attending a private out of state college who already has 40-60k debt of student loans.

    When my step father dies, will my mom be responsible for the debt. FYI – his will states that my mom is to receive everything. The cars are in her name and up until a few years ago their paid off house was only in my moms name. Since everything goes to her – is there an estate?

    2nd question – can the mother who may have taken out another loan for her daughter’s education roll all the loans together without my step father’s consent?

    My mom who is 63 was just laid off, but was planning to retire soon. Please help me find a way to protect my mom for her retirement years.

    many thanks in advance.

    • Barbara Raus Barbara says:

      Jen – I’m sorry to hear about your stepfather. Here’s what happens should a cosigner die. First, the borrower needs to contact the lender to inform them that the cosigner has died. At that point the lender will file a claim with the estate. After that, the main borrower will be solely responsible for the loan. The cosigning responsibility would not transfer to your mother.

  54. te says:

    I am trying to get a cosigner release from Wells Fargo since my credit score is much better than when i first applied for the student loan. I owe 35K(original loan amt was 25K) and i am the primary borrower trying to pay this down fast(interest rate is 9.25%)…I have made the first 13 payments on time and i have some savings that could pay 13 more payments to put me at the 24 months needed for cosigner release. i have a charged off 2nd mortgage but all other items are current and never defaulted on my credit cards.should i do a private consolidation loan, does wells fargo offer that and what is the interest rate and do you think paying in advance they would accept this as 24 months of payment?
    Thanks

    • Barbara Raus Barbara says:

      te – there are a couple scenarios to consider. You could try to consolidate the loan (which Wells Fargo does offer, check out details here: https://www.wellsfargo.com/student/consolidateloans/privatestudentloans ). Since your credit has improved you may qualify for better terms than on your current loan. To qualify for cosigner release you would need to pay those scheduled payments until you get to 24 consecutive on time payments – paying one lump sum wouldn’t qualify you for cosigner release. At that point you could request to have your cosigner removed and we’d consider your credit then. So you could immediately have a loan without your current cosigner if you qualified to consolidate on your own (plus possibly reduce the amount of your monthly payments and/or interest rate) or keep paying on your current loan and ask for the release when you get to 24 consecutive on-time payments.

  55. Jake says:

    I have a loan through Wells Fargo that I have been trying to get my Aunt off of (who is primary, why I dont know) and have been denied multiple times. The last time I was denied I had a co signer with great credit and they still wont let me be primary. Here is the problem. I get the loan statements, the loans are in my name with my account number and address. I pay ALL the payments on the loan and always have. My aunt has not made and will not make one payment on these loans. I get an interest statement and she gets the 1098 form. Up until last year I always just claimed the interest since I paid it and have all the checks to prove it and I have had very little problem doing so. I send the IRS the proof that I make the interest payments and they let me claim in the past. I got a bill this year for over $500. My tax lady told me that the IRS is “tightening” down on this. This isnt fair. They are saying that I cant claim the taxes on my student loan because I am not primary and my SS is not on the loan, despite the undeniable proof that I make these payments. MY Aunt CANT and WONT claim the interest because 1) She doesnt make the payments and if she get audted she will have no proof that she made the payments and that is illegal and 2) Its no ethical for her to claim interest that she didnt pay.
    I just want to get the loan in my name and cant Wells Fargo has had me trapped for 10 years and I cant do anything about it (right now). I want to know why I cant claim the interest and if you cant help me, maybe point me in the right direction of who can because this seems like illegal practice to me on both ends and I do not want to be in hot water with the IRS.

    Thanks
    JAke

  56. Carol says:

    My husband died unexpectedly and quickly, of Pancreatic Cancer, he was a Primary Borrower on a Sallie Mae Student Loan. There was no Co-signer listed, my daughter was listed as the Student Borrower. The loan was discharged due to his death after I sent original death certificate and all information needed. Shortly after wards, Sallie Mae began sending bills in my daughter’s name. Sallie Mae changed account number, but still had my husband’s information they just added my daughter’s first name. They even left my husband’s middle initial. All that was changed was the account number. Since we were told the loan was discharged, my daughter called. We were still under the impression that the loan was completely discharged. After talking to them, she again received a bill, different account number, my daughter’s name, my husband’s middle initial, and letter telling my daughter she is now responsible for repayment. He was the sole provider and my daughter is a single parent and unemployed. They are calling all hours of the day. We are devastated because we were originally told that the loan was completely discharged and now on top of our grief, we are also unable to pay due to financial strains. She told them of her financial status, even filled out paperwork stating she is unemployed. It’s hard to get a hold of anyone that speaks English clearly, and the agents seem to tell you anything just to get you off the telephone. We are so confused. Could you please help?

  57. Marla says:

    I have my retirement investments with Wells Fargo and was researching Student Loan defaults as I was contacted today by my daughter’s loan holder, ie. debt collector. The loan originated with AES. The debt collector is telling me that since I have assets for retirement, I have to “exhaust the assets” as the co-signer now responsible for the loan or they will garnish my wages. He refuses to discuss payment options with my daughter. I know they can garnish my wages. Can they demand payment form retirement accounts?

  58. Anonymous says:

    Just like all the calls I have made, no one at Wells Fargo can answer my question. Go figure. Wells Fargo will NEVER get my business, my family’s business or my friend’s business ever again. Wells Fargo is a predatory lender and if you do a google search you can see they are being investigated for their lending practices. I hope they go bankrupt

    • Nancy says:

      I am sorry that you have not been satisfied with the service you have received. Please be assured that your comments have been taken seriously. We are committed to providing all of our customers with excellent customer service; therefore, your feedback is very important to us.

  59. Von says:

    Hello, my dad was a consigner on a private student loan as I was a minor at the time and he died unexpected of cancer leaving nothing behind and my mother struggling to pay for the house and all of her bills. I didn’t even think to discuss with him my student loans as I’m still a student married with kids everything is deffered…. What happens now? Are they going to take my moms house? I’d have a mutiny my whole family would blame me and ruin my life with lawsuits and I can only imagine what else…

    • Nancy says:

      Hello Von, we are so sorry for your loss. I’d recommend you talk with your student loan servicer. (who you send your payments too) They will be able to give you the most accurate details concerning your situation. Best of luck!

  60. Oli says:

    Hello. Do you think my wife will be able to cosign for my graduate student loan? She is 23 years old.Graduated last year from College. She works as a Financial Analyst since 9-10 months in NY, makes 60K gross a year + bonus (about $4000 net/month). Credit score of 720. We just bought a house on her name for 145K. Mortgage payment is $519 and the maintenance is $380 so less than $1000 total. She also has a student debt (no interest from college and some federal stafford loans) of $45000 => monthly minimum of $480. So all monthly debt is about $1500, which leaves her with $2500/month to spend. We are seeking $25,000 at a fixed rate for the University of Pennsylvania Law School. Thx for your help. Btw, I’m an international student with no SSN but I have a credit card with BoA (limit $1000) with a for a couple of years, so I should have a credit. My balance is 0 for this card. I use it every month but I pay it off. Thx so much for your help!

    • Nancy says:

      Thanks for your post, for a student loan, most lenders require that the student be a permanent or temporary resident alien with a U.S. cosigner. I’d check with your school’s financial aid office to see what recommendations they’d have for someone in your situation.

  61. Ashley says:

    So I have been trying to settle my student loans. I am in the army and have the loan repayment program. My grandfather co signed both my student loans and he passed away last year. Several years ago he consolidated a bunch of his loans and debt to include my car and at least one of my student loans (I say at least one since I found out that one is completely paid off) I told him not to put my student loans on here but the guy he was working with didn’t want to listen. Unfortunately there wasn’t much I could do since I was deployed at the time. My question is do I have to worry about that loan anymore? And what about my car? Does any of this affect my credit? Thanks for your time!

    • Nancy says:

      We are so sorry for your loss Ashley. I’d recommend you talk with your current loan servicer or the original company you borrowed from. They will be able to give you the most accurate details concerning your situation. Hope this helps!

  62. Anonymous says:

    I had a question. My sister in law co signed on a lease for me. she recently went to my leasing office to ask for information and the leasing office gave her my personal information without my consent. Is this legal? is she able to retrieve info just because shes my cosignor? i thought she could only recieve info if she became responsible for my debt in the event that I could not pay it.

  63. Jean says:

    I cosigned my step daughter student loan five years ago. She finished her school, she’s working now and married. She stopped making payment six months ago. Sallie mae has been contacting me since, and I have been contacting her but she’s ignoring me and I think she’s been ignoring sallie mae too. I know I’m equally responsible for the loan, but why should I pay when I know she can pay. Do you have any idea if there’s a legal remedy for this? Appreciate your advice. Thank You.

    • Dana says:

      Hey Jean – I’d recommend you talk with your loan servicer. They will be able to give you the most accurate details concerning your situation.

  64. Mike says:

    The loan release option for co-signers is a joke. My son has made 36 consecutive on time payments and his income has doubled in three years. His credit score is 788 and was denied the request to remove me as co-signer. the reason duh excessive credit inquires. Thats because the other three banks that he had al l allowed the release and wells fargo did not.. I am canceling all my accounts with Wells.. .. this is not fair

  65. Popasmurf says:

    Can a private lender request full payment from the primary borrow after the co-signer pass-away and they could not collect anything on co-signer’s estate, even if the primary borrow has their loan deferred until they finish school?

    • Dana says:

      Hi-I’d recommend talking to your student loan servicer as they will be able to give you more accurate details concerning your loan and what options may be available to you.

  66. pam f says:

    hi, apparently my ex husband put me on as a co-signer of a student loan while we were still married. i just found out but the divorce is finalized and am not sure what steps to take. it was done electronically can i be held liable for this? also what will happen if i get the company involved, will he end up in jail?

  67. Sally says:

    I cosigned a Sallie Mae private consolidation loan for a family member and cannot be released due to the type of loan. She just tried applying at Wells Fargo for a new loan to pay down Sallie Mae without me as cosigner but can’t since there is only one loan. Are there any other options?

    • Dana says:

      Hi Sally – Sorry to hear of your situation. Wells Fargo’s current policy is to require more than one loan be consolidated but we are consistently looking at our policies. We are in the process of reviewing the multi-loan requirement but have no set date on when it will be changed

      • Sally says:

        Hi Dana – have there been any changes to Wells Fargo’s policy? Is more than one loan still required?

        • studentloandown says:

          Hey Sally- Thanks for your interest in our loan programs. You may consolidate with just one loan; however, we do require a minimum balance of $5,000.00. Please contact us at 1-800-263-5511 to discuss the application process.

  68. Tom C. says:

    Does Wells Fargo offer a cosigner release after the primary borrower has made a given number of on time payments or their income has increased? If so how many payments?

    • Dana says:

      Hi Tom, Yes, in some cases a co-signer can be released from student loan responsibility. The student borrower can request that his or her co-signer be released once the student has made all of the first 24 consecutive monthly payments on time and meets certain credit requirements. Student borrower must be a U.S citizen to be eligible for co-signer release. Please contact us at 1-800-658-3567 or shoot as an email at http://www.wellsfargo.com/student and click “Contact Us” for more details.

  69. David says:

    I just applied for a student loan last week and it asked for a cosigner so I had my cosigner go to the website to cosign. It said that it went through but when I logged in to check the status it said that I did not have a cosigner, meaning that my loan is in limbo. It has been almost five days (maybe more) and it still does not acknowledge that the loan has been cosigned. What’s going on?

  70. Tjohns says:

    I had an undergraduate student loan which I am the primary and my father is the co-signer. I am currently in grad school and had the loan deferred for the longest time possible while in school and the time ran out and was up for repayment last year in May. I made a few payments but was having trouble with my reduced income so they have me the option of temporary hardship forbearance 3 months at a time. I had no obligations to make payments during those time periods and when I didn’t I made payments. My account was status was update and not delinquent. I filed chapter 7 myself which was discharged 2 years ago and it never seems to have affected any of my student loans I paid them when necessary they never went to default after the discharge.

    My parents filed chapter 13 to save their house because of their business that was underwater and their business loan used the house as collateral. They reorganized under 13 maybe 4 years ago and have been makin payments which just finished December/January of this year. Their chapter 13 case has yet to be discharged though the court has not finished the paperwork even though they made their last payment already it’s not official.

    I come to find out the lender of those undergraduate student loans I spoke of defaulted my loan as of feb 1 this year and sent it to collections who now has my loan without any notification whatsoever I only found iut because the new collectors called and left me a voicemail sayinf I owe a debt and need to pay it when I have no outstanding bills or debts I even knew about. Aftee the worst run around of trying to call and my original servicer of the loan and the new debt collectors I found out my parents chapter 13 was in my servicers notes for January with my fathers name. After the person saw that he ceased to give me any information about my account and kept telling me this is a bankruptcy matter and I am not allowed to legally comment any further but you should see a lawyer about it.

    I looked up my credit report and indeed my student loans are now negative and in the comments it says bankruptcy chapter 13 and in the status it says “wage earner plan”. These student loans were not negative previously and were not impacted by my personal chapter 7 which was discharged years ago.

    Now I don’t know how to go about fixing this because this is my parents 13 showing up in my credit report which has nothing to do with me other than being the cosigner on a loan for which I was completely current prior to this showing up on my credit report.

    If the default is based on my parents 13 they actually aren’t even discharged yet by the court so are they even supposed to be contacting me regarding the loan. I thought the automatic stay was until the loan is discharged. I don’t know whether I need to do to the credit bureau to have the 13 removed from my credit report or go back to the lender to have them do it although they weren’t very helpful in out previous talks.

    • Dana says:

      Hello T. Johns – it’s unfortunate to hear of this news. In a situation like this, we do recommend that you contact the loan servicer and inquire about the options that may be available to you.

  71. Melody Beattie says:

    My question is: Does a co-signer have legal recourse to collect money from the person he/she co-signs for, the person who received the benefit of the loan, when the co-signer is the one who paid back the loan? Before you answer, please read the rest of the story. The father of the student son who needed a co-signer knew/knows I’m conscientious about maintaining an excellent credit rating. He also knows I’m vulnerable to the threat of anyone’s child being seriously ill or dying; I lost my son when he was 12. I had known the father on a business level for several years before I co-signed. Six months before I co-signed, the father and mother began inviting me for dinner whenever I was in town. They talked about how their oldest daughter was facing a series of brain surgeries that could be fatal and how her illness had affected the family finances. Then the father asked me for a personal loan of $9,000. I said yes; he agreed to make $500/month payments, starting in two months. In two months, he did what he said he would. He made two payments. He also began talking daily about the additional problems caused by the daughter’s illness, either by calling or emailing me: it was depriving their youngest son from finishing college. They desperately needed a co-signer or the son was out of luck. One day the father called and said in a dream the night before, he “saw” himself, his wife and I at the son’s college graduation, tears streaming down our faces with joy and gratitude. I so should have seen this coming. That’s when I agreed to co-sign one-year’s student loan for $27,000 with WF. The father promised he’d replace my signature with someone else’s within a few months, not to worry, this was temporary. Co-signing was so easy. I turned on my computer, typed my name. It’s done. As soon as the son and his college received the money, I had my Last Supper with the family. I met the “probably fatally ill” daughter, asked her how she was doing, given her condition. She looked at me like I was crazy and said, “What are you talking about?” That’s when the lights came on. It’s also when the father stopped making payments to me on the personal loan. The dinner invitations stopped too. I was going through personal situations then. I’d come down with a permanent health problem (declared totally disabled by the State but because I work for myself, continue working and don’t ask the government for money). I was also flying across the country monthly, taking care of my mother who was dying from Alzheimer’s. I was nervous about both loans to this family. I read the loan agreement with WF. I knew if the son defaulted, WF could begin collection proceedings against me with no warning. I telephoned the father and son. I asked if either intended to pay back their debts that involved me: the son for the student loan money when it came due; the father for the personal loan. The father said, “You have no written agreement with me about that loan. It’s your word against mine. And good luck if you try to take me to court.” The son was silent but in that silence I heard his answer; “No.” Shortly after, I contacted WF and paid off the student loan in full. I had no idea if or when the son would default, and I didn’t want any harm to my credit rating or the additional stress from not knowing what was going on. Two and one-half years have passed. I haven’t heard from anyone in the family since. The son graduated, as far as I know. No, I wasn’t invited to the ceremony. Had I not paid it off, his loan would be past-due. Co-signing a loan is a big deal. It’s permanent. It’s a legal and binding contract. There are many potentially negative consequences for the co-signer. Don’t do it unless you intend to pay back the loan. Read the stories on this site. Chances are good that you’ll be the one who pays the loan which brings me back to my question. Do people have legal recourse against someone they co-sign for, when the co-signer pays the loan? My guess is you’ll tell me to see an attorney. My second guess is that I have no recourse against either father or son so why waste more money. The family won the lottery — the dad with the personal loan because I didn’t get it in writing and the son got one free year of education — on me. I got an education too but it wasn’t free. When asked to co-sign, Just Say No. If someone wants to go to college, he or she will find an honorable way to pay for their tuition. Guard and know your weak spots because the person who signs on the dotted line doesn’t have to be you.

  72. jennifer says:

    Hi I’ve been working for a year and a half I want to start establishing credit I want to get a credit card my mom is willing to Co sign for me but she had little income coming in would she be able to Co sign for me

    • studentloandown says:

      Hi Jennifer, that’s great to hear that you are interested in establishing credit in your name! Since your mother is willing to co-sign for you, you should do some research to find the right card for you. Check out a non-sales website like bankrate.com to see what cards are available and then talk with your banker about your options.

  73. Barbara says:

    My daughter became disabled right after graduation. Her father co-signed but he has passed away. What happens to the loans? My daughter will never be able to pay them and they are threatening to turn the loans over to the co-signer (We have told them a million times that he died). If they transfer them, is my daughter off the hook?

  74. no name says:

    What if someone cosigned for your child as a favor to you,who’s responsible if child doesn’t pay?

The Student LoanDown

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