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

Upgrade

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®.