Can You Get Student Loans Without a Cosigner?

You may face a struggle to borrow enough money for college if you don't have a family member or friend who's willing and able to act as a cosigner on your student loans. However, you can qualify for student loans without a cosigner. Here's an overview of your options:

What is a cosigner?

A cosigner is usually a family member or friend who legally agrees to take financial responsibility for paying back your student loans in case you're unable to make your payments.

Borrowers may need a cosigner if they’re like most people heading to college for the first time — they lack steady income and haven't yet built a good credit history. A cosigner gives the lender more confidence that the loan will be paid back, increasing the likelihood of approval.

A cosigner could also help you borrow more money or get a lower fixed interest rate — even if you technically could get approved to borrow on your own.

Federal student loans

Federal student loans offer all borrowers the same fixed interest rate, no matter their income or credit score (interest rates will vary based on the loan type). There are two main types of federal loans: Direct Subsidized loans and Direct PLUS loans. For the 2019-2020 academic year, the interest rates for Direct Subsidized and Unsubsidized loans are 4.53% for undergraduate loans and 6.08% to 7.08% for graduate and professional students.

However, federal loans feature set borrowing limits. In your first year of undergrad, you can only borrow $5,500. In your second year, you can borrow $6,500; and $7,500 in your third year and beyond.

If you still require additional funding, your parents can apply for a Parent PLUS loan, but they’ll need to borrow the money themselves and will be solely responsible for repayment. They’ll also have to satisfy income and credit rating criteria to get approved.

Like Direct Subsidized and Unsubsidized loans, there are limits to how much can be borrowed via Parent PLUS loans each year ($9,500 the first year, $10,500 the second year, and $12,500 the third and subsequent years).

Private student loans

Most major student loan lenders require that you have a cosigner, or good enough credit history in order to qualify yourself.

However, you may be able to find lenders who will offer private loans with no cosigner at a higher interest rate. If you take out one of these loans, you may want to refinance it as soon as you graduate, get a job, and build up your credit history so that you can qualify for a lower rate.

Additional resources

If you can't find student loans without a cosigner, contact your school's financial aid office to see if they can refer you to lenders who work with students in this situation.

If you have a friend or family member who would qualify to be a cosigner but are reluctant to make that commitment, there are ways you can limit their liability in the future.

For example, some student loan lenders offer the option to release a cosigner after a specified number of on-time payments. You can also release your cosigner from responsibility by refinancing your student loans after you graduate, start making a regular income, and build up your credit history.

Ready to take the next step?

Citizens is here to help you navigate your student lending options for today and the future. Make sure to visit our  Student Lending page — we’re on chat.