Information for cosigners helping students cover the costs of college
Cosigning for a student loan is not unusual. In fact, the majority of undergraduate students have at least one cosigner. Cosigners are typically parents, guardians or relatives. As a cosigner, you can help an applicant qualify for a loan or receive a lower interest rate. Understand, though, that cosigning for an education loan comes with added responsibilities for the debt.
One or two cosigners may be beneficial to student loan applicants for many reasons.
Since many college students have limited or average credit histories, cosigners who meet the credit and underwriting criteria can help those students qualify for loans. That means meeting certain debt-to-income ratio limits and having a qualifying credit score to either meet the required minimum or qualify for a lower interest rate.
Most ISL Education Lending loans have a maximum debt-to-income ratio requirement. This ratio is calculated by dividing monthly debt payments by gross monthly income.
As a cosigner, you can also help an applicant receive a lower interest rate for their loan. A second cosigner may help the applicant receive an even better rate if they have a better credit score.
Some lenders combine and average out credit scores of applicants and cosigners to determine a loan's interest rate. ISL Education Lending is different.
As a nonprofit, ISL Education Lending is able to offer competitive rates to students and their families. As a cosigner, you can help your applicant receive an even lower rate, which can help them pay less in interest over time.
Total Interest Paid on a $10,000 Loan
These gauges show the different estimated interest costs on fixed rates. Helping borrowers receive lower rates can pay off in the long run.1
If you intend to cosign for a Partnership Advance Education Loan or Illinois Partnership Loan, you can pre-qualify to see what rates the applicant would receive based on your credit score. Pre-qualify today and review information specific to you. Once you pre-qualify, you’ll receive an email with the information provided during that process and a link for the student to complete the application.
At this time, cosigners cannot start the application process. The applicant must complete the online portion of an application first. But you can review the specific credit and underwriting requirements for each loan under Common Questions, as well as review other important information.
Once an applicant completes the online application, you will receive an email with instructions for completing the cosigner portion of the application. In addition, you will likely need to submit some paperwork that allows ISL Education Lending to verify the debt-to-income ratio and other information. Typically, a copy of your most recent pay stub will be required. If you’re self-employed or retired, you will need to submit copies of your most recent tax returns or proof of retirement income.
Required document details will be provided via email and our secure website. All documentation may be securely submitted online, through the mail or by fax.
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Making sense of financial aid offers and options to pay for college can be challenging. Plan smart and pay less for college with this kit filled with valuable information about financial aid, student loans and reducing the need to borrow. Request the Free College Financing Information Kit today.
As you prepare to help your student through the college application process, understand the different elements and make a plan to help. Continue reading article.
When financial aid is not enough to cover the total college costs, students and families have many loan options to consider. These tips can help with the decision-making process. Continue reading article.
If a student does not receive enough financial aid to cover the cost of college, you may be asked to help. Understand your role before taking out a loan in your name or cosigning a student loan to help with costs. Continue reading article.
Is your student facing increasing variable interest rates on student loans with months (or years) to go before repayment begins? ISL Education Lending offers a fixed-rate refinance loan that may help you and your student avoid increasing rates, even for loans from different lenders, while continuing to postpone repayment until after college. Continue reading article.
We offer several different tools to help students and families plan for college and find ways to cut the need for borrowing. Check out the College Planning Tools section to learn more about different resources for college planning.
Throughout the year, students and families can take advantage of different scholarship and award programs to receive funds that will help reduce college costs. Review the ISL Education Lending scholarship programs online today.
1 These calculations assume the borrower makes no payments while in school (or while the student for whom the borrower has taken out a loan is in school) and during a six-month separation period, for a total of 51 months where repayment is deferred. The interest rate is assumed to be the same during the in-school period and separation period and once the borrower enters a 15-year repayment period. No origination fees are included in these examples. Loans that require interest-only monthly payments or principal and interest payments during the in-school period may result in smaller total interest charges. Back to content
Submit paperwork or documentation electronically for your loan application.
Once the application has been processed and the school has certified the student's eligibility, the applicant will receive an email with a unique link to finalize the loan application, to provide information on references and view and accept the loan offer.
If the applicant needs this email resent, need assistance with accessing the secure site or has questions regarding the application, they may call (800) 542-6005. Messages left after hours will be returned on the next business day.