Tips for Getting a Cosigner for a Loan
Having a cosigner can dramatically increase your chances of getting your loan approved, but finding a responsible adult who is willing to co-sign for you can get a little tricky. Usually, applicants who are looking for a co-signer are unable to get the loan themselves because of poor credit history. This is already one strike against you when trying to convince another individual to co-sign for you. However, there are some circumstances where an individual simply doesn’t have any credit history at all, such as an 18-year old freshman in college. Your co-signer reassures the lender that the loan will be paid back based on the co-signers income and credit history.
Who Should be My Co-signer?
Ideally, a family member should be a primary consideration for your co-signer. This is because your family is simply more likely to sign for you since they have known you for a long period of time and have stronger bonds with you, which gives them more reason to trust you not leave them hanging. Start with your parents first, since they are older, more established, and more likely to have good credit ratings. If your parents are unable or unwilling to co-sign, you’ll have to branch out even further. Look to siblings and extended family members, such as grandparents, aunts, uncles, cousins, and step family members. The bigger your family is, the greater your likelihood for finding a willing co-signer.
If family members aren’t working out so well, consider friends. Whether they’re co-worker friends, childhood friends, or friends from school, there is a high probability that your friends will be willing to help you out in a financially burdensome situation. If you have an older friend in good financial standing, you will want to approach him or her first.
Why Should Someone be My Cosigner?
The dilemma in your current situation is that you need to find a responsible adult with an excellent credit history, but a person who fits these characteristics is significantly less likely to vouch for a risky investment. For this reason, the burden of convincing someone why they should be your co-signer is on your shoulders. Present your co-signer with all your concrete plans to pay back the loans. Supply them with realistic and achievable goals, including Plan B’s and Plan C’s in case anything goes wrong. This lets the co-signer know that you take this loan, and their willingness to help you get it, seriously.
If you’re looking for a large size loan, consider taking out several small loans using several co-signers. A co-signer will probably be more willing to vouch for your $5,000 loan as opposed to your $25,000 loan. If you have multiple potential co-signers, this is likely the best route to go. Furthermore, you should research each loan provider you are considering and present this information to the potential co-signer to ensure an extra incentive to co-sign your loan.
How Can I Ensure My Cosigner that They Made the Right Decision?
Once you have a co-signer, you want to maintain the goals that you set at the very beginning of the process. Always keep an open line of communication with your co-signer and even go as far as to send them copies of your loan payments each month. This lets them know you are going out of your way to responsibly pay back the loans. Make sure to always put excess income toward your loans to get them paid off in the quickest manner possible.
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