If you have trouble getting a personal loan, a co-borrower or co-signer can improve your chances of approval. They may also be able to help you get a more competitive rate and even take out a larger loan.
Not all lenders allow co-borrowers or co-signers, however, and there are risks to both parties.
What is a co-borrower?
A co-borrower, also known as a co-applicant, fills out a joint loan application with you and shares full legal responsibility for the loan from the beginning. It's common for loans for shared property, like mortgages or car loans, to have co-borrowers.
Both applicants are considered co-owners of the financed asset, though full ownership depends on the loan, lender and title documents.
A co-borrower can also be helpful with a personal loan if you have bad credit or a limited credit history. The lender will consider their credit history, debt-to-income ratio and other financial factors. That can help you qualify or receive better terms but it also means they're equally liable for payments from the beginning.
Their credit will also be impacted if you fall behind on the debt and a lender can pursue either of you for the full balance.
Co-signer vs. co-borrower: What's the difference?
Co-borrowers shouldn't be confused with co-signers. A co-signer adds their name to your application to help you qualify for a loan and is liable if you fail to make payments.
They may not need to provide as much documentation on the loan application and typically do not share ownership of any asset the loan is used to finance.
Co-borrowers are more common when trying to finance a shared asset, like a house or a car. Co-signers are more common when parents or guardians are helping students get funding for college.
Benefits of having a co-borrower
Improves your odds of approval: Applying with a co-applicant can help you get approved for a personal loan with bad credit or low income.
You may receive better terms: With a qualified co-borrower, you may be offered a lower rate, more flexible repayment terms or a larger loan amount.
You can build your credit history: If you make on-time payments, it can establish or rebuild your credit history.
Risks of having a co-borrower
The loan Impacts both your credit: Your lender will run hard inquiries on both of you during the application process, temporarily lowering your scores. If you're approved, their credit utilization rate will also go up, which can further damage their credit. And late or missed payments can appear on the co-applicant's credit report, as well.
You're both responsible for the debt: If you fall behind, a lender may be able to sue your co-applicant for payment. (Depending on the loan, they may not have to wait until you default.) The loan will also raise their debt-to-income ratio, impacting their ability to get loans, credit cards and other financil products.
It can damage your relationship: Even asking a friend to be a co-applicant can cause friction. If you fall behind on payments, it could torpedo your relationship, especially if the lender goes after them for payment.
Being removed from the loan may be difficult: Not all lenders allow a co-applicant to be released from a loan before it's paid in full. Those that do typically require a certain number of on-time payments.
Lenders that allow co-borrowers for personal loans
Only certain lenders let you to apply with another person for a personal loan and most that do allow co-borrowers rather than co-signers.
SoFi accepts co-borrower and approves loans for as much as $100,000. There's no origination fee and you may get your loan funded the same business day.
We like that SoFi has high loan caps and doesn't charge any origination fee, so borrowers get the full amount funded. The credit requirements can be stringent, however, and interest rates for weaker applicants are on the higher side.
- Loans approved for up to $100,000
- No origination fee or late fee
- Next-day funding available
- Accepts co-borrowers
- Minimum loan amount is $5,000
- High APR for fair/low credit
Fixed rates from 8.74% APR to 35.49% APR. APR reflect the 0.25% autopay interest rate discount and a 0.25% SoFi Plus interest rate discount. SoFi Platform personal loans are made either by SoFi Bank, N.A. or, Cross River Bank, a New Jersey State Chartered Commercial Bank, operating from its Delaware branch, Member FDIC, Equal Housing Lender. SoFi may receive compensation if you take out a loan originated by Cross River Bank. These rate ranges are current as of 02/23/26 and are subject to change without notice. Not all rates and amounts available in all states. See SoFi Personal Loan eligibility details at https://www.sofi.com/eligibility-criteria/#eligibility-personal. Not all applicants qualify for the lowest rate. Lowest rates reserved for the most creditworthy borrowers. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, income, and other factors.
LightStream also accepts co-borrowers and doesn't charge an origination fee, either. It has repayment terms that range from 24 to 144 months (two to 12 years).
We like that LightStream offers competitive APRs, no late or origination fees and long loan term options. But you can't prequalify and the loan minimum may be too high if you only need to borrow a small amount.
- Same-day funding available.
- Loan amounts up to $100,000.
- No origination fee or late fee.
- The minimum loan amount is $5,000.
- Prequalification not available.
- No option to pay your creditors directly.
Happen Bank approves loans for as little as $1,000, making it a good option if you need a co-borrower for a small loan.
Formerly LendingClub, Happen Bank offers competitive rates on a wide range of loan amounts, with funds available in as little as 24 hours after final approval.
- Accepts borrowers with fair credit.
- High loan limit of $75,000.
- Funds may be available in as little as 24 hours.
- Repayment terms range from two to seven years.
- Co-borrowers are permitted.
- Doesn't accept co-signers.
- Origination fee of 2% to 6%.
- No autopay discount.
FAQs
FAQs
What credit score does a co-borrower need?
There isn't a universal credit score requirement, but generally, a co-signer with good (670 to 739), very good (740 to 790) or excellent (800 to 850) credit can strengthen your application. A lender will still consider other factors, though, like your income, existing debt and any history of default payments or bankruptcies.
What's the difference between a co-borrower and a co-signer?
A co-borrower is considered an equal applicant — they are liable for payment from the beginning and may share in ownership of any financed asset. A co-signer is responsible for payment if the primary borrower fails to make payment but usually doesn't have access to the funds or the item being financed.
When can a lender require a co-borrower to make payments?
Technically, a lender may be able to go to a co-borrower as soon as the first payment is due. Co-borrowers are individually responsible for the full debt, so the lender does not have to wait for numerous late payments or the loan to go into default to pursue the co-borrower.
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*Fixed rates from 8.74% APR to 35.49% APR. APR reflect the 0.25% autopay interest rate discount and a 0.25% SoFi Plus interest rate discount. SoFi Platform personal loans are made either by SoFi Bank, N.A. or, Cross River Bank, a New Jersey State Chartered Commercial Bank, operating from its Delaware branch, Member FDIC, Equal Housing Lender. SoFi may receive compensation if you take out a loan originated by Cross River Bank. These rate ranges are current as of 02/23/26 and are subject to change without notice. Not all rates and amounts are available in all states. See SoFi Personal Loan eligibility details at https://www.sofi.com/eligibility-criteria/#eligibility-personal. Not all applicants qualify for the lowest rate. Lowest rates reserved for the most creditworthy borrowers. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your creditworthiness, income, and other factors.
**Your LightStream loan terms, including APR, may differ based on loan purpose, amount, term length, and your credit profile. Excellent credit is required to qualify for lowest rates. Rate is quoted with AutoPay discount. AutoPay discount is only available prior to loan funding. Rates without AutoPay are 0.50% points higher. Subject to credit approval. Conditions and limitations apply. Advertised rates and terms are subject to change without notice. Payment example: Monthly payments for a $10,000 loan at 7.99% APR with a term of 3 years would result in 36 monthly payments of $313.32.
