Student loans for parents & cosigners: What are your options?

By Willa Tellekson-Flash | Published on October 21, 2025

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Many families and supporters want to help students pay for college, but the best way to contribute isn’t always obvious. Whether you’re a parent, guardian, relative, or family friend, knowing your options—financial and non‑financial—helps you identify the best way to support that fits both your circumstances and the student’s needs.

Federal Parent PLUS loans: What to know

A parent or legal guardian can take out a loan in their own name to help cover a student’s education costs. Federal Parent PLUS Loans are specifically available to parents or legal guardians of dependent undergraduate students, providing a way to cover education costs beyond other financial aid. Unlike cosigning a private loan, the student has no legal responsibility to repay this loan.

• Eligibility: A credit check is required, but if you don’t have a strong credit score, you can still be approved by adding an endorser or documenting extenuating circumstances.
• Loan amount: You can borrow up to the total cost of attendance minus any financial aid the student receives.
• Interest rates and fees: These loans have a fixed interest rate set annually by Congress (currently 9.08% fixed for 2024–2025) and also incur origination fees (currently 4.228%).
• Repayment: Payments typically start right after disbursement, but deferment options are available while the student is enrolled at least half-time.
• Responsibility: As the borrower, you are legally obligated to repay this loan. The student carries no responsibility.

Cosigning a private student loan: How it works

When you cosign a private student loan, your student is the primary borrower, but you’re agreeing to take joint responsibility. So you’re not borrowing the money yourself, but you are legally responsible for repayment if the student can’t pay. Cosigning a private student loan can open doors for a student who doesn’t yet have the credit history or income to qualify alone—but you’ll also share responsibility for the loan’s repayment.

• Eligibility: It varies by lender, but generally lenders look for a credit score of about 650 or higher and a steady income.
• Rates and fees: Strong credit can typically unlock lower rates than Parent PLUS loans. Many private loans also skip origination fees. (Earnest in particular also charges no fees.)
• Credit impact: Missed or late payments hurt both credit scores, while on‑time payments build them.

Earnest supports a broad range of cosigners—guardians, relatives, family friends, and more. Once the student is ready, you can refinance the loan into their name to remove your obligation.

Other ways to support your student financially

Loans aren’t the only way to help pay for college. Consider these other ways to help lower borrowing needs and build lasting financial skills:

• Contribute funds or start saving early: A 529 college savings plan can help chip away at tuition before the first bill arrives.
• Teach budgeting basics: Show students how to track spending, set realistic limits, and avoid unnecessary debt. Healthy budgeting habits can set them up for financial success both in college and beyond.
• Navigate Free Application for Federal Student Aid (FAFSA®) and scholarship applications: Helping your student complete the FAFSA on time or identify relevant scholarships can make a big impact on reducing a student’s loan needs. These applications and deadlines can be daunting, so a little support can go a long way.
• Compare aid offers: Review net cost across schools and, if needed, help them appeal for more aid.

Key questions to ask before taking on debt together

Taking on debt for a student is generous, but it’s also a serious commitment. If you’re exploring cosigning with your student, ask yourself these questions before you sign:

• Can you comfortably afford payments if the student can’t pay?
• Is the student ready and responsible enough to manage repayment?
• Have you explored all scholarship, grant, and federal aid options?
• Do you clearly understand loan terms and repayment obligations?
• Who will be responsible for repayment after graduation?

Exploring your options with Earnest

Supporting a student’s education can be rewarding—but careful planning and consideration of your options will help you make informed financial decisions that best support the student and protect your financial health.

Ready to take the next step? Check to see if you can Prequalify with Earnest with no impact on your credit to see personalized rates and decide if cosigning a private loan fits your plan.

About the Author

Willa Tellekson-Flash

Willa Tellekson-Flash is a freelance writer and product marketer specializing in finance and technology. With 10 years of experience, she focuses on making complex personal finance topics accessible and empowering for all audiences. When she’s not writing, you'll likely find her training for her next marathon.