Co-Signer Eligibility for Education Loan

The most common question asked by students applying for educational loans in the US is if they need to have a co-signer always to apply for a loan. If a student is applying for a TERI guaranteed loan that requires a credit-worthy borrower, s/he must be credit-worthy or must apply with a credit-worthy co-signer. However, if the student is a graduate student, a health professions student, or is studying for a second undergraduate degree, then s/he may apply without a co-signer as a credit-ready borrower. Certain of TERI's partner's loan programs (for graduate students and health professions students) allow the student to qualify for a TERI guaranteed loan even if s/he does not meet all of the criteria of credit-worthiness.

So how does a student know what "credit-ready" means? The simple criteria for finding out credit-readiness means that the applicant satisfies certain credit criteria, although an established credit history is not required, and is a US citizen or permanent resident who has had a stable residence in the US for the past two years.

The advantage of TERI-guaranteed loans to credit-worthy applicants is that they generally carry lower rates and fees than those made to credit-ready applicants. This means that if a student is credit-worthy or can apply with a credit-worthy co-signer, then the total cost of his or her loan will be lower.

The other problem may be that for some students, the university of their choice may not be TERI-approved. In this case, students should contact their school's financial aid office and have the Director of Financial Aid (or an administrator in similar capacity) apply to TERI for school approval. School approval is a long process and can take as much as 30 - 60 days. So it is recommended that if you know you will need a loan in a few months, then get in touch with your school of choice now. It is also possible that the school may already have applied for TERI approval, in which case the waiting time reduces.