I co-signed student loan for my son, who has graduated from college, but is not working, cannot pay the loan...I am on Social Security, and the stress is killing me. Is there any possible way to get me out of this? What needs to happen to get me removed as a co-signer.
How to get out of a co-signer position on a Sallie Mae student loan.
Well the ultimate lesson here is for you to tell anyone that might ever consider co-signing for a private student loan to not do it.
There is a process to get removed as a co-signer with Sallie Mae. It's there own process. Unfortunately they don't know what it is. Take a look at this Salle Mae brochure from 2010 that describes the process.
The sales pitch was about how easy it would be for people to get removed. They said, "APPLY WITH A COSIGNER
Sallie Mae encourages you to bring a cosigner to the table. They've even made it quick and easy for a cosigner to fill out the application with you. Adding a creditworthy cosigner usually means a lower interest rate and a better chance of approval.
After you graduate and demonstrate that you can handle principal and interest payments, you can apply to release your cosigner from your loan. That means your cosigner can help you when you need it the most without having responsibility for the loan for its full term." And they reference footnote 4 which says, "To qualify for cosigner release, the borrower must have successfully completed school, made 12 consecutive on-time principal and interest payments, meet age of majority requirements, and meet the underwriting requirements when the request for cosigner release is processed. The borrower must be a U.S. citizen or permanent resident at the time the cosigner release is processed." - Source
So if your son wass current on his loan and has made the consecutive payments required, keep pushing at Sallie Mae for the release. The worst case scenario is your son defaulted on his payments and you would not be eligible for a release.
But since 2010 Sallie Mae has changed their wording on the program and added a bunch of new qualifying statements. They now say, "The release of a cosigner is at the sole discretion of Sallie Mae. Only the borrower may apply for cosigner release. The borrower must provide proof of graduation or successful completion of certification program, not be delinquent and have made 12 consecutive on-time payments of principal and interest immediately before applying, provide proof of income, pass a credit review that demonstrates a satisfactory credit history and the ability to assume full responsibility of the loan(s) individually, have no student loan(s) in default, must not be reported as 90+ days delinquent in the past 24 months, must not be in hardship forbearance and/or in a modified repayment program, be a U.S. citizen or permanent resident, and meet the age of majority in their state. Requirements are as of October 13, 2014, and are subject to change." - Source
Before I go I wanted to leave you with three easy action items you jump on right now to address your situation. Just click here.
If you have a credit or debt question you'd like to ask, just click here and ask away.
If you'd like to stay posted on all the latest get out of debt news and scam alerts, subscribe to my free newsletter.
Don't miss my free my weekday email newsletter with the latest tips and advice on how to beat debt and do better financially. Subscribe now. - Click Here