Can You Have a Cosigner on a HELOC?

If you’re looking to get approved for a home equity line of credit (HELOC) but are worried your credit score or income won’t make the cut, you may be considering adding a cosigner to strengthen your application. But can you have a cosigner on a HELOC?

The short answer is: it’s possible, but very difficult. Most major lenders don’t allow true cosigners who aren’t on your property’s title and mortgage. But don’t lose hope. We spoke to mortgage specialists at several major banks and online lenders to determine which ones allow cosigners and which don’t.

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Can you have a cosigner on a HELOC?

Cosigners on HELOCs are generally uncommon, but you can find lenders that allow it. A cosigner agrees to repay the HELOC debt if the primary borrower can’t pay, even though they don’t have any ownership of the property used as collateral.

In other words, a cosigner isn’t listed as a borrower on your mortgage and doesn’t live in your house. They could be a parent, child, partner, friend, aunt, uncle, or other adult who agrees to cosign a loan with you. 

The main benefit of using a cosigner is that it may help you qualify for a larger HELOC amount than you could on your own. Or, it could help you get approved in general when you otherwise might get denied. This is because the lender considers the cosigner’s income and credit along with the borrower’s finances.

Lenders typically prefer that all borrowers on the HELOC also have an ownership stake in the home securing the line of credit—hence why many don’t allow cosigners. If the person isn’t on your mortgage, there’s no stake. 

Tip

⚠️Warning: There’s a major risk involved with being a cosigner. You become equally liable for repaying the HELOC balance, and it gets listed on your credit report as if it’s your own debt. This could damage your credit or leave you responsible for the full loan if the primary borrower can’t pay. Only you can decide if you’re willing to take on this risk to help out a trusted friend or family member.

Lenders that allow HELOC cosigners

Very few HELOC lenders allow cosigners. The LendEDU team spent hours consulting company websites and speaking with mortgage specialists to determine which HELOCs can have cosigners. 

Based on our research, many of the popular HELOC lenders don’t allow non-occupant cosigners on home equity products. However, a few do make exceptions. 

This table highlights which HELOCs allow co-signers, which allow co-borrowers (aka, someone already listed on your mortgage), and which ones allow neither.

Lender	Rates (APR)	Allows cosigners/co-borrowers?
TD Bank	8.59% – 18.00%	Both
Bank of America	Starting at 10.22% (6.99% intro APR for 6 months)	Both
Citizens Bank	8.50% – 21.00%	Co-borrowers only
Better Mortgage	9.00% – 15.55%	Co-borrowers only
Regions Bank	9.00% – 15.875%	Co-borrowers only
Figure	7.80% – 17.20%	Neither
Upstart	8.50% to 18.00%	Neither

As the table shows, TD Bank and Bank of America are among the few major lenders that allow cosigners on HELOCs. We confirmed with these lenders that if you decide to cosign on a loan for someone, you do not need to be on their home’s title or deed, and you do not need to live in the house with them. 

To boot, both TD Bank and Bank of America have some of the lowest HELOC APRs on our list, so they’re a good place to start your search if you need a cosigner for your loan. 

Other major lenders like Citizens Bank, Better Mortgage, and Regions Bank only allow you to apply with someone else if that person is already listed on your home’s mortgage and/or live in the same house as you. In other words, they must be a co-borrower or co-applicant. 

Lastly, we found that popular online HELOC lenders like Figure and Upstart don’t allow co-borrowers or cosigners. Only one name can be listed on the HELOC documents. 

HELOC with cosigner vs. co-borrower

There’s a lot of lingo tied up in HELOCs and home equity loans. Two common phrases you’ll see are cosigner and co-borrower. But as we’ve already mentioned, these are two different things that you can’t use interchangeably.

• A cosigner agrees to be equally liable for repaying your HELOC even though they aren’t listed on your mortgage loan or deed. In other words, they have no stake in the property that’s securing the line of credit. 
• A co-borrower or co-applicant is an equal applicant on your home’s title and mortgage documents. So, if you’ve bought a house with a partner, you could use them as a co-borrower on your HELOC. 

Home equity companies tend to be much more open to co-borrowers than cosigners. This is because co-borrowers have more “skin in the game” when making payments. After all, they also own the property you’re using as collateral. Lenders see co-borrowers as less risky than allowing a non-owner cosigner on the debt.

Should you get a HELOC cosigner?

If…	Consider a cosigner?
You have good credit but limited income	✅
You don’t qualify on your own due to high debts	🤔
You have poor credit	🤔
You can’t find a lender that allows cosigners	❌

You have good credit but limited income

If your credit score meets the lender’s HELOC requirements but your income is low, adding a cosigner with a solid income could improve your approval odds. 

Here’s why: Lenders consider your debt-to-income (DTI) ratio when you apply for a HELOC. This ratio compares your monthly debt payments to gross income, and most lenders prefer a DTI under 43%. 

If your monthly debt is $2,000 and your income is $4,000, your DTI is 50% ($2,000 / $4,000). So, as it stands, it could be too high. However, adding a cosigner’s income could help lower this ratio for you so it falls within the approval threshold.

You don’t qualify on your own due to high debts

Like the example above, a cosigner could help you qualify for a HELOC if you have too much debt relative to your income. If they have low debt and a decent income, it could improve your DTI ratio and make you look better to HELOC underwriters. 

While this is a good thing, it’s important to consider whether you can still comfortably afford your new HELOC payments on top of your other debt payments without the cosigner’s help. (Remember, a cosigner is only there to help if you, the primary borrower, can’t pay. They’re a backup, a Plan B.) 

A HELOC is a new form of debt, and if adding one more payment to your pile would further strain your finances, think twice. 

You have poor credit

If you’re thinking about getting a cosigner for a HELOC because you have poor credit, it may not help much. This might surprise you, so let us explain. 

Although every lender differs, we spoke to a mortgage specialist who explained that many lenders use the lowest credit score on a HELOC application to determine approval. So, if you have poor credit, a cosigner likely won’t help increase your approval odds because yours will still be the lowest score. 

This may not be true for every lender—some may not use the lowest score. But it’s something to remember if you’re considering a cosigner because of bad credit. 

Read More

Home equity loans & HELOCs for bad credit

You can’t find a lender that allows cosigners

It’s much more common to find a HELOC lender that allows co-borrowers than to find a lender that accepts a cosigner who isn’t on your mortgage deed or who doesn’t live in your house. 

So, even if you want a cosigner for your HELOC, you may not be able to do it based on the availability in your area. The list above is a great place to start your search if you’re considering a cosigner on a HELOC. 

Can you have a cosigner on a home equity loan?

Yes, you can potentially have a cosigner on a home equity loan if you can find a lender that allows it. Based on our research, the policies are generally the same as for HELOCs—most lenders don’t allow cosigners, but some will allow co-borrowers.

A home equity loan differs from a HELOC in that it is an amortizing term loan rather than a revolving line of credit. With a home equity loan, you receive the full amount upfront and make regular monthly payments over a set term (usually five to 30 years) to pay it off.

In contrast, a HELOC gives you a credit line to draw from as needed, allowing you to re-borrow any amounts paid back during the draw period. After the draw period ends, you enter the repayment period and can no longer borrow more.

Despite this product difference, most lenders treat home equity loans and HELOCs the same when it comes to cosigners versus co-borrowers. Very few banks allow true non-owner cosigners. Lenders prefer having all applicants be co-borrowers on the home loan and deed.

Ask the expert

Erin Kinkade

CFP®

If you don’t think you can get approved for a HELOC or home equity loan without a cosigner, look for other loan options that allow co-borrowers, such as personal loans. Also, begin saving for the expense need (assuming it is a flexible goal) or request help from a trusted family member or friend—either as an outright gift or a loan you repay over an agreed-upon period. Lastly, wait until your credit and financial condition improve if the funds aren’t immediately needed.