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Guide to getting a personal loan with a co-signer

Sometimes you need assistance qualifying for a personal loan

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If you don’t meet the minimal requirements for a personal loan on your own, you still have options. Some lenders allow you to add a co-signer to strengthen your loan eligibility. Applying for a personal loan with a co-signer can help you qualify for a loan and secure better rates than you would otherwise have access to.

Key insights

  • Adding a co-signer to your loan application can improve your eligibility and rate.
  • You are still responsible for paying your loan on time.
  • Being a co-signer is risky because the co-signer’s credit score is on the line if the primary borrower doesn’t repay the loan.

Why you might need a co-signer

Personal loans are considered unsecured loans, or loans that are not tied to collateral. Therefore, lenders have strict credit and income guidelines. You might need a co-signer if you have:

Even if you qualify for a personal loan, having a co-signer with a higher credit score and income may help you lock in a lower interest rate.
  • A low credit score
  • Low or no income
  • No credit history
  • Not met age requirements
  • Freelance/gig income
  • A high debt-to-income (DTI) ratio

Even if you can’t find a co-signer with excellent credit, having two signers rather than one can help increase your approval chances.

Michael, a ConsumerAffairs reviewer from Arizona, was approved for more money than he asked for from a lender “even though my co-signer and I have both had some credit challenges in the past.”

» MORE: Average personal loan interest rates

Types of loans you might need a co-signer for

Co-signers can help you increase your loan eligibility for many types of loans. If you have minimal or bad credit history, plan to use a co-signer for the following loans:

  • Student loans: Private student loans often require a co-signer to meet minimum eligibility. However, you do not need a co-signer for federal student loans, so it is best to apply as the sole borrower so you can qualify for loan assistance in the future if needed.
  • Car loans: Even if you can secure a car loan as the sole applicant, a co-signer can help you get the lowest rate possible. You don’t want to overpay on your car loan because brand-new vehicles depreciate quickly.
  • Personal loans: Personal loan rates can be upward of 30% if you have bad credit. A co-signer with excellent credit can keep you on the lower end of the rate range and save you money on your loan.

Difference between a co-borrower and a co-signer

Co-signers and co-borrowers can both increase your chances of qualifying for a loan, but they are not the same thing.

“A co-borrower is used if you want to share the loan — both borrowers would have access to the funds and are responsible for repayment,” said Kendall Clayborne, a certified financial planner at SoFi. Co-borrowers are common among spouses or when more than one income stream needs to be considered for a larger loan balance, she says.

A co-borrower is used if you want to share the loan — both borrowers would have access to the funds and are responsible for repayment.”
— Kendall Clayborne, certified financial planner, SoFi

“A co-signer, however, may be used to help the original borrower qualify or get a better interest rate on their loan,” Clayborne said. A co-signer does not have access to the loan funds but shares the repayment burden. If you don’t repay your loan and the co-signer doesn’t step in, you both are liable to take a credit hit.

» MORE: Best personal loans with a co-signer

How to find a co-signer

A co-signer can be anyone who meets loan eligibility requirements. They can be a spouse, parent, grandparent or other trusted friend or family member. However, you will need their permission to use them as a co-signer, and not everyone is willing to take on the risks of co-signing.

Ideally, your chosen co-signer should have an excellent credit history and a steady source of income. If their credit score is high, you’ll have access to better loan rates.

A warning about using a co-signer

Your co-signer’s credit is attached to your personal loan. If you miss a loan payment, both of your scores will suffer. If you can’t make payments on the loan, the co-signer will be held equally responsible. Endangering your co-signer’s finances can damage your relationship with them.

Pros and cons of using a co-signer

Remember: Your co-signer takes on a risk when they agree to be on your loan. Don’t take it personally if a loved family member or friend does not want to take that financial risk.

If you’re not able to find a co-signer, you might have to take on a higher interest rate or find an alternative way to borrow money.

Consider these pros and cons of using a co-signer before proceeding with a co-signer.


  • Easier to qualify: Having two signers makes it more likely you get lender approval.
  • Better rate: If your co-signer has a better credit score, you could get a better interest rate.
  • Better credit history: If you repay your loan on time, you can improve your credit.


  • Credit score risks: A missed payment will hurt both your and your co-signer’s credit.
  • Broken relationship: If you don’t repay your loan, you can damage your relationship with your co-signer.
  • Co-signer on the hook: If you can’t repay your loan, the co-signer will be responsible.

What to do if you can’t get a co-signer

You still have options if you cannot get a co-signer for a loan.

  • Improve your credit score: If poor credit is the reason you can't secure a loan, focus on improving your credit score. Regularly paying bills on time, keeping credit balances low and avoiding new debt can help improve your credit score over time.
  • Consider a secured loan: A secured personal loan is a loan backed by collateral, such as a vehicle, savings, property or stocks. As a result, these loans are easier to qualify for.
  • Seek nontraditional lending sources: If traditional banks and credit unions won't approve you, consider other sources. Online lenders, peer-to-peer lending platforms, and credit unions often have more flexible lending criteria.

» COMPARE: Best online loans

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    Is it easier to get approved for a loan with a co-signer?

    Yes, getting a personal loan if you have limited credit history or income is easier with a co-signer. A lender will view lending to you as less risky since you and another individual are both responsible for the loan.

    What credit score does a co-signer need for a personal loan?

    While each lender might have its own minimum score, finding a co-signer with good to excellent credit (a FICO score of 670 and above) is ideal.

    Can I get an online loan with a co-signer?

    Some online lenders allow co-signers. As you apply with one of these lenders, there should be a space on the application that allows you to input the co-signer's information.

    Can I be denied a loan with a co-signer?

    Having a co-signer doesn’t guarantee getting approved for a loan. This is why it is important to use a co-signer with good to excellent credit and steady, sufficient income.

    Bottom line

    A co-signer can be your ticket to personal loan approval and better rates. Lenders are more likely to give you access to better financial products if you have a co-signer with excellent credit and good income — regardless of the type of loan you’re applying for. If you don’t have access to a co-signer, you can still borrow money; you just might need to secure it with collateral or agree to a higher interest rate.

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