The Ultimate Co-signing Student Loans Quiz
by Staff
With the rising costs of higher education, more and more people are turning to student loans to finance their college educations. Often, however, such loans require students to get co-signers for their loans. What exactly is a cosigner, and why do banks want students to have them? Test your understanding of this topic with this quiz.

Why might a college student need a co-signer for a student loan?

  • because he or she has no significant credit history
  • because he or she can't afford to pay for college without a loan
  • because students are only allowed to take out a portion of their loan themselves

If a student defaults on a loan for which he has a co-signer, who may be subject to legal action?

  • the student
  • the co-signer
  • both the student and the co-signer

What is an added benefit of having a co-signer on a student loan, even if you have good credit?

  • lower interest rates
  • improved credit rating
  • shorter payment schedule

What type of student loans do not require co-signers?

  • government-backed loans
  • loans under $10,000
  • loans for graduate school

Who will a bank accept as a co-signer for a student loan?

  • only the student's parents
  • any relative of the student
  • anyone who is willing to be a co-signer

When should you find a co-signer other than your parents for your student loan?

  • if they have bad credit
  • if they are already co-signers on an older sibling's loan
  • if they would be able to pay for your tuition without using a loan

Other than the liability itself, why else might people be hesitant to co-sign your student loan?

  • It could limit their ability to get other loans.
  • They may have to pay annual fees.
  • Student loans are often seen as socially unacceptable.

What makes a default on a student loan worse than most other loan defaults?

  • They cannot be dissolved via bankruptcy.
  • It was supposed to be less risky due to the co-signer.
  • It is the first major loan that most people get.

How long does it take for a negative event to be removed from your credit report?

  • seven years
  • 12 years
  • never

What is special about a forbearance, as opposed to a delayed payment agreement on your loan?

  • The interest does not accrue during the forbearance period, as it does with a delayed payment.
  • It does not have a negative affect on your credit rating, while a delayed payment does.
  • There are no fees associated with a forbearance, as there is with a delayed payment.