Many or all companies we feature compensate us. Compensation and editorial research influence how products appear on a page. Student Loans Denied a Student Loan With a Cosigner? 7 Smart Next Steps Updated May 30, 2025 3-min read Expert Approved Expert Approved This article has been reviewed by a Certified Financial Planner™ for accuracy. Written by Lindsay VanSomeren Written by Lindsay VanSomeren Expertise: Mortgages, personal loans, student loans, auto loans, banking, budgeting, debt, insurance, credit cards, credit Lindsay VanSomeren is a personal finance writer living in Suquamish, Washington. She's passionate about helping people learn how to manage their money better so that they can live the life they want. In her spare time, she enjoys outdoor adventures, reading, and learning new languages and hobbies. Learn more about Lindsay VanSomeren Reviewed by Crystal Rau, CFP® Reviewed by Crystal Rau, CFP® Expertise: Equity compensation, oil & gas investments, education planning, investment planning, student loan planning, retirement Crystal Rau, CFP®, CRPC®, AAMS®, is a certified financial planner based out of Midland, Texas. She is the founder of Beyond Balanced Financial Planning, a fee-only registered investment advisor that helps young professionals and families balance living their ideal lives and being good stewards of their finances. Learn more about Crystal Rau, CFP® Being denied a student loan, even with a cosigner, can be disheartening, but it doesn’t mean your college plans are over. About 64% of cosigned private student loan applications were denied in 2020, so you’re not alone. Let’s walk through exactly what to do next and explore options for students who want to avoid using a cosigner altogether. In case you’ve exhausted your federal financial aid, school aid package, and scholarship opportunities, and are currently in need of funding for school, here’s our list of top-rated private student loan lenders: Best Private Student Loans in 2025: Reviewed and Ranked. Keep reading for steps to take when denied a student loan with a cosigner! Company Rates (APR) Rating (0-5) 5.0 View Rates 5.59% – 16.99% 5.0 View Rates 4.8 View Rates 5.59% – 16.99% 4.8 View Rates 4.7 View Rates 5.59% – 16.99% 4.7 View Rates 4.7 View Rates 3.54% – 15.99% fixed-rate APR w/ all discounts included1 4.7 View Rates 4.6 View Rates 5.59% – 16.99% 4.6 View Rates 4.6 View Rates 11.16% – 13.98% 4.6 View Rates 4.5 View Rates 5.59% – 16.99% 4.5 View Rates 4.4 View Rates 2.71% – 7.38% 4.4 View Rates Table of Contents Understand the role of a cosigner Find out why you were denied Take action with these 7 options 1. Apply with a different lender 2. Find a new cosigner 3. Improve your credit 4. Explore federal student loans 5. Consider non-cosigned private student loans 6. Explore alternative funding options 7. Talk to your financial aid office Understand the role of a cosigner Private lenders require a cosigner when the student can’t meet credit or income requirements alone. A cosigner agrees to repay the loan if you default, making your application less risky for the lender. Find out why you were denied The lender is required by law to tell you why your application was denied. Common reasons include: Low credit scores (student or cosigner) Insufficient income High debt Recent bankruptcies or missed payments Citizenship or enrollment issues Check your and your cosigner’s credit reports for errors at AnnualCreditReport.com. The actual denial doesn’t hurt your credit score. However, it is marked on your credit report as a hard inquiry. The effect on your credit score is low, but it can harm you if you have several hard inquiries. Lenders can take that to mean you’re always looking for credit. If you’re applying with several lenders to compare offers, it’s best to do this all at the same time so potential lenders can see you’re shopping for a specific loan, not just going out and trying to get credit. Crystal Rau , CFP® Take action with these 7 options 1. Apply with a different lender Not all lenders have the same criteria. You may be denied by one and approved by another. It’s OK to reapply immediately through a different lender that may have less strict guidelines, but if you choose to reapply with the same lender, it’s best to wait and work on the items that need improvement. That could mean increasing income or lowering overall debt Crystal Rau , CFP® 2. Find a new cosigner If possible, ask another qualified family member or close friend with stronger credit to cosign. 3. Improve your credit Build your score with a secured credit card, on-time payments, or small personal loans. Check your score regularly and dispute errors. 4. Explore federal student loans Direct Subsidized and Unsubsidized Loans don’t require a cosigner. Revisit your FAFSA and speak with your school’s financial aid office to confirm eligibility. 5. Consider non-cosigned private student loans Some lenders specialize in loans that don’t require a cosigner: Funding U – Best for undergraduates MPOWER – Best for international students Ascent – Best for deferred repayment Edly – Best for income-based repayment 6. Explore alternative funding options Look into income-share agreements (ISAs), tuition payment plans, or crowdfunding for education 7. Talk to your financial aid office Your school may offer emergency grants, payment plans, or help you file an appeal for more aid.