A person makes a good cosigner if they meet the following criteria:
- They have good to excellent credit, typically a credit score of around 720 or higher, which helps in loan approval and securing lower interest rates.
- They have a steady and stable employment history, ideally being employed at their current job for over a year, demonstrating reliability.
- They have sufficient income to cover both their own expenses and the loan payments if the primary borrower defaults.
- They are usually U.S. citizens or permanent residents, as lenders often require this to ensure they can collect any debt if needed.
- Good health can also be a factor, as some lenders may require the borrower to repay the full amount if the cosigner dies, which could impact the borrower financially.
In addition to these financial and legal qualifications, trustworthiness and willingness to take on the responsibility of covering missed payments are essential qualities of a good cosigner.
