Lenders That Accept Personal Loan Co-Signers

With a co-sign personal loan, you add a second borrower with stronger credit. You’re both responsible for paying back the loan.
A co-sign personal loan may be an option for borrowers who don’t qualify for a loan on their own. Adding a co-signer’s credit history and income to a loan application can increase your chances of qualifying and get you more favorable terms.

Here’s where to find co-sign personal loans, plus information on how the loans work and the risks of co-signing

Our picks for

Online lenders that allow co-signers
Online lenders are a convenient — and often the fastest — option for personal loans, and many allow borrowers to add a co-signer.

FreedomPlus

Laurel Road Personal Loans

LightStream’s website

OneMain Financial

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Past-due student loans, credit card debt

U.S. credit card balances grew to $868 billion in the second quarter, from $848 billion in the previous three months, and the proportion of those balances seriously past due is on the rise, according to Federal Reserve Bank of New York data released on Tuesday.

U.S. consumer debt has continued to hit new peaks, rising $192 billion, or 1.4%, to $13.86 trillion in the second quarter. The figure is higher than the previous peak of $12.68 trillion before the 2008 global financial crisis, according to the New York Fed’s U.S. household debt and credit report.

While total student loan balances decreased slightly, from $1.49 trillion to $1.48 trillion in the quarter, the share of those loans being left unpaid for several months increased.

A comparable measure shows credit card users, too, are falling behind. Payments on about 5.2% of those balances were 90 days overdue in the latest quarter, up from 5.0% in the first quarter. The figure has been on the rise since 2017. Similar delinquency rates declined for auto loans, home equity lines of credit, mortgages and other debt categories.

Consumer spending accounts for two-thirds of activity in the world’s largest economy, and a growing job market and higher wages have helped the longest U.S. economic expansion on record continue this year.

But fears the U.S.-China trade war and other issues could cloud that economic picture led the Federal Reserve to cut interest rates for the first time since 2008 late last month. That could ease pressures for some borrowers and cause consumers to load up on more debt to make purchases, a short-term stimulus for the economy.

“We may see more consumers making a large purchase they had been putting off because it seems relatively more affordable,” said Dieter Scherer, a financial planner at Adaptive Wealth Solutions LLC.

“We’ll likely see credit card rates decline by a small amount in response to the cut in the target federal funds rate. However, charge-off rates have been increasing over the past few years, which has also contributed to increased credit card rates among less credit-worthy consumers. So, I’d expect the effect to be more muted among those with low credit scores.”

 

 

Five areas that impact your fico

There are five areas that impact your FICO® Score. Let’s break these down along with the weight of each category.

  • Payment history (35%): Payment history plays the biggest role in your score, and it’s also the easiest to explain. If you make your payments on time, that helps your score. If you pay late, it hurts your score. It’s worth noting that a payment isn’t reported late by the credit bureaus until it’s 30 days past the due date. If you have accounts that have been placed in collections or charge-offs, these are also considered bad for your score. Finally, bankruptcies and foreclosures are also factored in here. The effect of these negative marks does fade over time, though it may take several years.
  • Amounts owed (30%): In this category, the total amount you owe across both revolving debts (like credit cards) and installments (like mortgages, car loans and personal loans) is a factor. The thing to really pay attention to at this point is your credit card usage because it’s the one thing you can control on a monthly basis. You want to keep your balances low relative to your overall credit limit. This ratio affects your score. The best thing you can do is buy only what you can afford and pay it off every month. In addition to being better for your score, you won’t have to pay interest. The reason we’ve focused heavily on credit cards is that your installment loans tend to have to do with things you need. Student loans were good for school, and you need a roof over your head. A lot of us need a car depending on the state of public transportation in our area. On the other hand, credit cards are one area where discretionary spending tends to be placed.
  • Length of credit history (15%): The more time you’ve spent building your credit history, the better it will be for your score. If you’ve had years of good history, lenders have more to go on than for someone who’s just getting started with credit. However, it’s not rated so highly as to avoid deeply penalizing those who are new to credit.
  • Credit mix (10%): Ideally, lenders want to see you can handle having a decent sampling of both revolving and installment credit. This shows you understand various types of financing. However, those with a younger credit history tend to have just a credit card or two. That’s OK because this category isn’t a huge factor in the formula.
  • New credit (10%): Each time you apply for a new credit card or loan, your credit score goes down a little bit temporarily. The thinking here is that if you need to apply for new credit or a loan there’s always the chance you could be overextending yourself financially. If you make your payments on time (among other good habits), your score should be back where it was in no time.

The traditional FICO® Score has a range of anywhere between 300 – 850. Anything over 670 is considered a good score. There are also special versions of your credit score that go from 250 – 900 for credit cards and car loans.

This isn’t universal, but generally when lenders take a look at your credit score, the one they’re paying attention to is from FICO®.

Credit Fixes That Actually Work

It can be frustrating trying to correct your credit report. You can do everything by the book and still come up short. As a result, many consumers just give up.

I can understand the frustration but it’s usually an expensive mistake to throw in the towel. Government studies show that 1 in 5 credit reports contain material errors. If your credit report has mistaken, don’t become just another statistic and don’t stop fighting. Here are four unconventional tactics you can use to stick it to the credit man and get the results you want.

1. Write Original Dispute Letters

The internet is full of template credit dispute letters that are free to download and easy to use. If you go this route you will save time and money. The only problem is you probably won’t get anywhere with the credit bureaucrats.

That’s because credit bureaus and creditors get thousands of letters every day. Most of these organizations use scanning software which identifies template complaints and send a stock response letter without much human consideration.

A better idea is to write your own dispute letter in your own words. This increases the likelihood that a live person will actually review your claim and consider it. By all means get an idea of what to say by reviewing sample letters but always put it in your own words.

Hint: Although some creditors and credit bureaus allow you to dispute credit problems over the phone or via the internet but don’t fall for it. Unless you put your claim in writing you lose many of the protections offered by consumer protection laws.

2. Don’t Follow The Suggested Path

Just about everything you read on credit repair tells you to first contact the credit bureau. They recommend you go to the creditor only after that fails. This advice is hogwash. It’s also the reason why people get frustrated with the credit repair process and give up. It’s very easy to go round and round with the credit bureau and get caught in a vicious loop.

Don’t fall for that trap. Its fine to contact the credit bureau of course but you should also go after the creditor who reported the negative item in the first place. Remember, they have to prove the information they supplied to the bureau is accurate, verifiable and complete. Again, they have the burden of proof and they have to send you a copy of their proof. If they can’t come up with the goods, they have to instruct the bureau to remove the negative information.

3. Use The Law

The only reason the credit bureaus and creditors respond to disputes is because they have to under the law. It’s in your best interest to understand the basics of these laws and reference them when you write your dispute letters to both the credit bureaus and the creditors. Fortunately, you don’t have to go to law school to leverage these rules.

The most important law to understand when it comes to consumer credit protection is the Fair Credit Reporting Act. This law governs how information about you is gathered, shared and used. Among other things, this law mandates how negative items are removed from your history and how credit bureaus are to behave.

The next law to reference is the Fair Credit Billing Act. This spells out what creditors can and cannot bill you for and how they are supposed to bill you.

Finally, there is the Fair Debt Collection Practices Act. If you fall prey to a collection agency, this law can help you get them off your back in a hurry.

Again, you don’t have to be a lawyer to get some fire power from these laws. Once creditors and credit bureaus see your references to these laws in your letters, they’ll know they are dealing with someone who means business. That might just be enough to get them to play ball with you.

4. Sue the Creditor in Small Claims Court

If a creditor won’t clean up an error that they reported, you can almost always take them to small claims court to force them to get off their duff and do the right thing.

The nice thing about this move is that lawyers aren’t usually allowed in small claims court. That means you’ve got more of an equal playing field. Also, suing in small claims is easy to do and very inexpensive for you. But it’s expensive for the creditor and a pain in their back side. As a result, once you serve papers, the creditor might just stop fighting and clean up their error.

The trick about suing creditors in small claims court is that you have to make sure to fill out the court paperwork correctly and you have to get your claim to the right people. And you have to be on top of the follow up requirements and actually follow through.

There is a lot at stake when it comes to cleaning up mistakes others have made on your credit file. The credit bureaus and reporting creditors may seem like formidable adversaries. But use the law and a little elbow grease. If you do, you’ll have a far better result in most cases.