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When considering where to go to college, a young adult has a dizzying array of choices, including public vs. private schools and colleges vs. universities. There are also liberal arts colleges, which can be appealing to creative types and those seeking a broad education resulting in exemplary problem solving and communication skills.

But what exactly is a liberal arts college? And how are liberal arts colleges different from other colleges and universities?

Liberal arts colleges tend to put more focus on broad academics and personal growth than on professional training programs. An education from a liberal arts college is still valuable in helping students start their careers, but the emphasis is more on producing well-rounded individuals than putting graduates on a specific career track like engineering.

Students can major in a wide range of subjects at a liberal arts college, including the arts, literature, philosophy, social sciences, natural sciences, and even math or engineering. However, these colleges are meant to be a place that values learning, without strictly limiting what students are learning.

Read on to learn more about liberal arts colleges, including what they offer, how they compare to larger schools and public universities, and how you can cover the cost of a liberal arts education.

A More Personal Vibe

Though both universities and liberal arts colleges will help prepare students for entering the working world, there are some differences in what the experience will be like:

1. Liberal arts colleges are smaller. Most classes will have far fewer students than is the case at a university lecture hall, which can have hundreds attending at the same time.
2. Because of the smaller size, it may be easier for students to bond with their professors. The faculty members often have more time to spend with their students.
3. The focus of a liberal arts school is undergraduate education. At universities, there will likely be graduate programs and major research efforts.

A liberal arts college may be the best college fit for students who prefer a more personal experience where they can get to know faculty members and other students.

Those trying to decide which college is right for them can take this eight-question college personality quiz.


💡 Quick Tip: Fund your education with a low-rate, no-fee SoFi private student loan that covers all school-certified costs.

The Admissions Process

The application process for getting into a liberal arts college is similar to other schools. Students will have to submit the usual components: an application with transcripts, test scores, essays, and letters of recommendation.

Liberal arts colleges may have a different focus when it comes to reviewing applications, though, so it’s essential to keep the following information in mind when applying to a liberal arts college.

When it comes to test scores and grades, liberal arts colleges don’t always have specific requirements. Admissions can still be very competitive at these schools, but they’re often more interested in whether or not students challenged themselves in high school. Generally, they want to see that applicants are well-rounded but also have an area of interest they specialize in.

Extracurriculars are important when applying to any college, but liberal arts colleges often value a wide range of activities, not just those that involve leadership.

A liberal arts college may be more likely to value extracurricular activities that are outside the box, so students applying to these schools have more options for what they can get involved in.

The Common Application, which can be used to apply to more than 900 schools, only requires one essay. However, many liberal arts colleges will require at least two supplemental essays. The reason is that these schools tend to put a high value on writing and critical thinking. This can be beneficial for students who have strong writing skills but may be weaker in other areas.

Many liberal arts colleges are also interested in a student’s character and how they’ll contribute to the school, so they may put more weight on letters of recommendation and interviews than other schools.

Top Ranked Liberal Arts Colleges

According to U.S. News’s National Liberal Arts Colleges Rankings for 2022-2023, the top ten liberal arts colleges are:

1. Williams College
2. Amherst College
3. Pomona College
4. Swarthmore College
5. Wellesley College
6. Bowdoin College
7. Carleton College
8. United States Naval Academy
9. Claremont McKenna College
10. United States Military Academy at West Point
11. Middlebury College

Financial Value of a Liberal Arts Education

There’s a stereotype about people who pursue a liberal arts education: that they won’t find financial success and their degree could be useless. This claim isn’t backed by evidence, though, so students who feel like a liberal arts college is the right choice for them shouldn’t be scared away by this false narrative.

The gap in income between those who attend a liberal arts college and those who attend other schools isn’t necessarily linked to the institution.

Instead, it’s determined more by a student’s career path and the market forces at the time, according to two economists who analyzed the payoff of a liberal arts college education.

Another reason for this misconception is that people are unaware of the diverse selection of topics that are studied at liberal arts colleges. If people don’t actually know what is being studied at these colleges, they’ll have a more difficult time conceptualizing what a student’s future could entail.

Though graduates of liberal arts colleges may not earn as much as those from STEM-oriented institutions right away, the economists’ study found that 60% of students ended up in the top 40% of U.S. income after graduation, even if they started out in the bottom 60%.

Choosing where to attend college and whether or not it will have a “payoff” is personal to each student.

Attending a liberal arts college can lead to upward mobility, but students also have to take into account the cost of the education and the availability of financial aid when choosing which school will have the most value for them.

Paying for College

Along with the painstaking process of choosing where to apply for college and making a final decision, there is another difficult process: figuring out the cost of tuition and how to pay for it all.

Luckily, students usually have access to a few options that may help fund the yearly cost of attendance, which goes beyond tuition and fees to usually include room and board, books, supplies, transportation, loan fees, costs related to a disability, and reasonable costs for eligible study-abroad programs.

To figure out financing, a good place to start is by filling out the Free Application for Federal Student Aid (FAFSA). This will let you know if you are eligible for federal financial aid, which includes grants, scholarships, work-study, and federal student loans (which may be subsidized or unsubsidized).

Some private colleges use a supplemental form called the College Scholarship Service (CSS) Profile, to determine how to give out their own financial aid. The form is more detailed than the FAFSA. Almost every college that meets financial need for all enrolled students without federal student loans uses the CSS Profile.

Most liberal arts colleges are private and carry a relatively high “sticker price,” which includes tuition, fees, room and board. But students will typically pay less, and sometimes far less, when grants, scholarships, and other benefits are factored in.

If students will require loans to cover the cost of college, it’s recommended they take out federal loans before private loans, because the former come with benefits that the latter usually do not, like lower fixed interest rates and income-based repayment plans.

Private scholarships are also widely available. Some are need based; others are merit based. They’re offered by schools, companies, community organizations, religious groups, and more.

Private student loans are an option as well. Eligibility usually depends on a student’s income and credit score or those of a cosigner. These loans are available through banks, credit unions, and online lenders and rates and terms vary, depending on the lender.


💡 Quick Tip: Would-be borrowers will want to understand the different types of student loans that are available: private student loans, federal Direct Subsidized and Unsubsidized loans, Direct PLUS loans, and more.

The Takeaway

Whether you choose to go to a state university or a private liberal arts college, the experience will be enriching and can set you up for long-term career success.

Though a liberal arts school isn’t solely focused on teaching students a profession, a Bachelor of Arts from a reputable liberal arts school can lead to a rewarding career. The skills students learn at a liberal arts college — which include communication skills, analytic skills, the ability to work in a team, and a strong work ethic — are ones that often highly valued by today’s employers

While liberal arts colleges are known for their high cost, keep in mind that your actual cost of attendance will likely be much lower than the “sticker price,” once you take grants, scholarships, and other types of financial aid into consideration.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs. SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SOIS0823023

A physician assistant (PA) is a medical professional who handles a variety of key responsibilities. According to the American Academy of Physician Assistants, these include:

•   Diagnosing illnesses
•   Developing and overseeing treatment plans
•   Prescribing medications
•   Serving as the principal healthcare provider for many patients

Gaining the skills necessary to take on these medical responsibilities involves a master’s degree level of education, as well as:

•   A bachelor’s degree
•   Courses in basic and behavioral sciences as prerequisites
•   An average of 3,000+ hours of direct patient contact
•   More than 2,000 hours of clinical rotations (beyond classroom instruction)

With all of those educational requirements, it’s natural to wonder about the physician assistant program cost.

PA Program Cost

The Physician Assistant Life collated information from these three key resources to arrive at average costs for the 2023-2024 application cycle: the American Academy of Physician Assistants (AAPA), The Physician Assistant Education Association (PAEA), and a recent NCCPA Statistical Report. What they found:

•   The average cost of a 27-month resident PA program (including public and private) is $95,165.
•   The average cost of a 27-month PA program (including public and private) for nonresident students is $103,660.
•   The average total resident tuition and nonresident tuition were higher for PA programs from private institutions than for those from public institutions.
•   There was a 4% to 7% increase in the average total resident tuition for public and private institutions.


💡 Quick Tip: When shopping for a private student loan lender, look for benefits that help lower your monthly payment.

Paying Physician Assistant Program Costs

After making the decision to become a physician assistant, it then becomes time to figure out how to pay for the PA program.

By the time someone reaches this point in their education, they are probably already aware of the Free Application for Federal Student Aid (FAFSA®) process that allows them to be considered for federal student aid. Often (but not always), by the time that someone is ready to fill out the FAFSA for PA school, they will be considered an independent student, someone who no longer needs to include parental financial information in the application.

Federal Student Aid

The results of the FAFSA application will determine eligibility for federal aid including:

•   Federal student loans
•   Federal grants
•   Federal work-study options

Federal loans can be a popular way to pay physician assistant program costs for several reasons, including the fact that payments:

•   Can be deferred until after graduation
•   Can sometimes qualify a student for tax deductions
•   May come with the potential for loan forgiveness

The types of federal loans available for graduate students are slightly different from those available to undergraduate students. The borrowing ceiling is higher but interest rates typically are as well. PA students may qualify for a Direct PLUS Loan if enrolled at least half time without any adverse credit history.

Federal Grants and Work Study Programs

Federal grants don’t need to be repaid. Here is a list of federal grants , their program details, and the amount that can be awarded.

PA students may also be eligible for work-study based on the FAFSA. Typically, students need to apply for these jobs, often ones at the university. Besides helping PA students to earn money, these jobs could be in the medical field, which can help students gain valuable experience.

University Help

Students can check to see what grants, scholarships, and/or fellowships their university offers by contacting the financial aid office. Some institutions use the FAFSA information to determine eligibility, while others have their own applications. Awards can range from a small grant to the amount of the full tuition. Check out deadlines for school-specific financial aid to meet them successfully.

More About Grants and Fellowships

Scholarships are available through the federal government, as well as through states, non-profit agencies, organizations, companies, and more. In general, these are merit based and don’t require repayment. (By contrast, grants are typically need-based.)

There are numerous grants and scholarships that are specifically designed to help with PA program costs. As just one example, the Physician Assistant Foundation has provided more than $2.3 million in scholarships to more than 1,400 future PAs. Requirements include:

•   Being a student member of the American Academy of Physician Assistants (AAPA)
•   Attending a PA program that is ARC-PA-accredited
•   Completing at least one quarter or semester in PA studies
•   Being in good standing, academically
•   Being enrolled in a PA program during the application cycle

Grants to cover PA program costs can get more niche, such as Association of Physician Assistants in Oncology’s APAO Student Scholarship . Requirements include:

•   Being an APAO member or applicant who is in the last year of an ARC-PA-accredited program
•   Being in the clinical phase, having already completed or nearly completed basic science courses
•   Not receiving a PA Foundation or other specialty organization scholarship
•   Having a strong interest in the oncology field; clinical rotation in an oncology speciality is strong encouraged
•   Having a minimum GPA of 3.0

As another example, Physician Assistants Orthopaedic Surgery, Inc. offers the annual Susan Lindahl Memorial Scholarship , providing four $5,000 scholarships each year.

Members of the National Guard may qualify for the Medical Professional Officer Accession Bonus (OAB). To find state scholarships and grants, contact the appropriate state’s Department of Education . If a parent died in Iraq or Afghanistan while in military service, a federal grant may be available.

There are also state-specific PA scholarships, such as those offered by the California Academy of Physician Assistants (CAPA). Student members of CAPA can be eligible for one of five different $2,000 scholarships.

It may help to look for opportunities from where the student’s bachelor’s degree was obtained. For example, if you are a member of a fraternity or sorority, there may be scholarships available to cover PA program costs.

In addition, student athletes who attended an NCAA institution could qualify for the NCAA Postgraduate Scholarship , with up to 126 of them awarded each year. Student-athletes must excel both academically and athletically and be in at least the last year of intercollegiate-level competition. Non-renewable scholarships of $10,000 are provided three times annually (corresponding with sports seasons of fall, winter, and spring) with 21 available for women and 21 for men during each sports season.

Fellowships

Graduate fellowships usually require that a student study, work, or research in the PA field, which means that they can gain useful experience while also earning money for the physician assistant program costs.

To find opportunities, talk to your university’s financial aid department or reach out to non-profit agencies connected to the PA field. The application process can be rigorous but can also be quite worthwhile.

Additional Ideas to Consider

When determining what PA school will cost, you’ll want to factor in any federal funding options (loans, grants, and scholarships), university help, and other grants, scholarships, and fellowships you may be eligible for. You’ll next need to consider what, if any, gaps in funding are left.

Ways to cover that gap can include employer tuition reimbursement, becoming an in-state resident, becoming a resident advisor (RA), working as a teaching assistant (TA), and private student loans. Here’s a closer look at each.

Employer Tuition Reimbursement

Some employers reimburse employees for a certain part of their education costs. It can be worth checking what is available, how to apply, and what constraints might exist. A company might, for example, only reimburse funds for certain degrees or they may require that a student receiving reimbursement stay at the company for a predetermined amount of time.

Some employers may provide employees with professional development funding. If so, you may want to find out whether this be used towards PA program costs.

In-State Resident

You can often save a significant sum of money by attending a public university in the state where you live. Each state determines residency in different ways. So if you’re thinking about relocating to take advantage of in-state residency savings, check to see what residency requirements are. Some states mandate one year of full-time residency while others may require three.

Resident Advisor

RAs help new students get settled into dorm life and are compensated for their work. This usually includes part, if not all, of their room and board; perhaps a meal plan; and sometimes a reduction in tuition. Plus, RAs typically can get their own room, which can make studying easier (although this job does come with plenty of responsibilities and interruptions). How much an RA is compensated varies by university.

Teacher Assistant

This can involve prep work for teaching, organizing lab work, conducting research, grading papers, and more. Payment can come in the form of reduced tuition or a stipend. Besides helping with PA program costs, being a teaching assistant can provide experience in the field and allow students to network with industry experts.


💡 Quick Tip: Need a private student loan to cover your school bills? Because approval for a private student loan is based on creditworthiness, a cosigner may help a student get loan approval and a lower rate.

Private Student Loans

If additional funds are needed, private graduate student loans can help. Private student loans are available through private lenders, including banks, credit unions, and online lenders. Rates and terms vary, depending on the lender. Generally, borrowers (or cosigners) who have strong credit qualify for the lowest rates.

Keep in mind, though, that private loans may not offer the borrower protections — like income-based repayment plans and deferment or forbearance — that automatically come with federal student loans. But if you are looking for supplemental funding for your PA program, private student loans may be worth looking into.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs. SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

SOIS0823022

If you’re interested in pursuing a career in the tech industry, coding bootcamps can be a quicker, more affordable alternative to getting a traditional degree. However, these courses still require a significant amount of time, energy, and money.

Are coding bootcamps worth it? They can be. You’ll want to keep in mind, however, that bootcamps vary in terms of quality, so finding a good one can take some research. In addition, the skills you learn from a bootcamp may not be enough to land the type of job or career you want.

Read on for key things you need to know about coding bootcamps. Including what they are, how they work, and how much you may be able to earn when you graduate.

What is a Coding Bootcamp?

Coding bootcamps are short, intensive courses designed to provide in-depth training in software development fundamentals, and prepare students for entry-level jobs in the tech industry.

Many people consider bootcamps when pursuing a career change or looking for a shorter path into the tech industry, as they last about 15 weeks on average.

Bootcamps are conducted in both traditional classrooms and online, and are designed to accommodate students with little-to-no coding experience.

However, not all coding bootcamps are accredited schools. While some boot camps are affiliated with universities and, therefore, required to uphold the educational standards of the institution it is in partnership with, most coding bootcamps remain privately owned with educational standards that may not necessarily be governed by any scholarly entity.

Therefore, coding bootcamps, no matter how appealing, may not all produce the same quality of education or warrant any recognition outside of the tech industry.

Recommended: How to Pay for Coding Bootcamps

How Much Do Coding Bootcamps Cost?

The cost of coding bootcamp can vary widely, and will depend on the school, the length of the program, whether classes are in-person or online, and whether you study full or part time. However, on average, tuition for coding bootcamp can run around $10,800.

While that’s not nothing, it’s a lot less than the cost of a traditional undergraduate degree. According to the National Center for Education Statistics, the average annual tuition at a public university is $9,678 for in-state students and $27,091 for out-of-state students. The average annual tuition for a private institution is $38,768. If you pursue a four-year bachelor’s degree program, tuition can total anywhere from $38,712 to $155,072, depending on where you go.

Like colleges and universities, many coding bootcamps now offer a range of funding options, so you don’t necessarily have to pay the full cost up front and out of pocket. These may include:

•  Scholarships: Some bootcamps offer scholarships for women, minorities, vets and even those experiencing hardships. You can often find out about scholarship opportunities by going to the tuition section of the bootcamp’s website.
•  Loans: External loans, including private student loans, are a common way to cover the cost of bootcamp.
•  VetTec/GI Bill: These military benefits provide veterans with tuition and fee assistance options. They currently only apply to a short, but growing, list of approved coding bootcamps.
•  Deferred Tuition: This allows students to enter and complete a coding bootcamp without upfront payment. You are required to pay back your tuition costs only after securing a job.
•  Income-Share Agreement (ISA): This is a wage-garnishment agreement between a bootcamp and a graduate. It generally specifies that once a graduate accepts a job, a portion of their income will be paid to the bootcamp for a specified length of time.

Is There a Stigma About Coding Bootcamps?

While coding bootcamps were once similar to Massive Open Online Courses (MOOCs) — virtual, often free or low-cost, classes notorious for their low completion rates — many of these programs are now highly respected by employers.

Unlike MOOCs, which are structured to teach hundreds of students at a time, utilizing a primarily hands-off teaching model, coding bootcamps typically rely heavily on instructor direction. Indeed, there may be more than one instructor assigned to each class, which is often no larger than 20 students.

Many programs are also highly intensive, requiring as much as 40 hours of weekly instruction. In addition, these programs tend to rely on project-based teaching methods that require students to immediately put their learnings into action.

However, there is no standardization for bootcamps, so all programs are not created equal. As a result, finding the right bootcamp can take a fair amount of time and effort.

If you are currently employed, it can be a good idea to talk to your supervisor or HR department about any bootcamps you are considering to get a sense of how the company views the program, and how completing the course could impact your career with the company. It’s also worth investigating if your employer offers a tuition reimbursement program that could help you cover the cost of bootcamp.

Recommended: Student’s Guide to Certificate Programs

What Can I Expect From a Coding Bootcamp?

Completing any coding bootcamp should ultimately result in fluency in at least one coding language, such as Full Stack JavaScript, NET, Ruby on Rails, or Java. In addition, you will likely graduate with a portfolio of projects you completed during the course.

And because the goal of a bootcamp is to churn graduates directly into the tech industry, these programs often help graduates find, apply, and interview for industry positions.

Bootcamps generally don’t go much further than that, however. While starting salaries for coding bootcamp graduates average $69,000 a year, these programs may not provide all the education you need to succeed in a tech career.

Also, in some cases, coding skills aren’t enough on their own to land a job. Some employers, for example, may be looking for a broader set of skills in computer science or specialization in a certain field. Others may place high value on interpersonal or soft skills that allow you to work effectively in a team and communicate with coworkers.

As a result, even after completing coding bootcamp, you may find it necessary to go back and complete your college degree at a later date.

The Takeaway

Whether or not coding bootcamp is worth it depends on your career goals and the quality of the coding camp.

On the plus side, coding bootcamp generally costs a fraction of the cost of a typical college degree. At the same time, these programs allow you to gain in-demand skills in a relatively short period of time, and many also provide job search assistance.

However, coding bootcamp may not be a great choice if you are not sure that a tech career is right for you, or you don’t have the time, interest, and motivation to complete an intensive and demanding program. Also, if you are interested in a management career or moving beyond coding, you will likely need a traditional college degree.

Whatever education route you pursue, you will need to figure out how you will cover the cost of tuition and expenses. Fortunately there are numerous options, including scholarships, grants, work-study, tuition payment plans, and both federal and private student loans.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs. SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SOIS0823018

If you’re interested in possibly refinancing your student loans, but you don’t think your credit history is strong enough, there are options that might help. One is to refinance student loans with a cosigner.

A cosigner could potentially help you qualify for a refinanced loan. But is taking out a new loan with a cosigner the right choice for you? There are pros and cons to carefully consider in order to decide if student loan refinance with a cosigner makes sense for your personal situation.

What Is a Cosigner on a Loan?

A cosigner is someone who legally agrees to pay your debt, such as your student loan debt, in the event that you can’t make payments yourself. The exact terms will vary based on the loan type and lender, but in general, this person signs your loan with you and accepts responsibility for your loan if you don’t make payments.

A cosigner can potentially be used for several different types of loans, from taking out a mortgage to borrowing for a car.


💡 Quick Tip: Some student loan refinance lenders offer no fees, saving borrowers money.

Can a Cosigner Refinance a Student Loan?

If you have private student loans, you might have needed a cosigner to qualify if your credit history was too new or not robust enough to qualify on your own.

Creditors review a variety of factors to determine whether or not they will give someone a loan. Things like a lot of existing debt or a low credit score can sometimes serve as an indicator to lenders that an individual could be a credit risk. Adding a cosigner could make a potential borrower appear less risky, since there’s another person (ideally one with a strong financial background) to help guarantee repayment of the loan.

Recommended: Applying for a Student Loan Without a Cosigner

Finding a Cosigner

If you can’t qualify for a loan based on your own credit history or current income, sometimes student loan refinancing with a cosigner who has a strong credit history could help improve your prospects.

You could ask a friend or relative to be a cosigner for refinancing student loans. Being a cosigner can be a hefty responsibility, so treat the request with respect, and perhaps plan to be open and honest about why you need to refinance student loans with a cosigner.

Pros and Cons of Having a Cosigner

Taking out a loan with a cosigner is a significant commitment, so it’s worth considering some pros and cons. What’s right for you will depend on your personal and financial situation.

One of the most notable benefits of refinancing with a cosigner is the potential to qualify for a loan that may not have been an option otherwise. A cosigner could also possibly help you qualify for a lower student loan interest rate than you otherwise may have received. If you have little to no credit history or bad credit, it could help to refinance student loans with a cosigner by giving you an opportunity to begin strengthening your credit.

On the flip side, there can be some cons to refinancing with a cosigner. If you fail to make payments on your loan, your cosigner will be responsible for repaying your debt. As a result, missed payments will likely reflect on both of your credit histories. This could also negatively impact your personal relationship with your cosigner.

In addition, there are pros and cons to the process of student loan refinancing. For instance, if you have federal student loans, refinancing makes them ineligible for federal benefits and protections such as income-driven repayment plans, loan forgiveness for public service, and deferment options. If you want or need access to these programs and benefits, refinancing won’t make sense for you.

Using a Cosigner when Refinancing Your Student Loans

When you’re refinancing your student loans, enlisting a friend or family member to cosign your refinanced loan could help strengthen your loan application.

If you’re trying to find a cosigner, you can start with the people you trust the most. Keep in mind that acting as a cosigner has risks — if you don’t pay back your loans, your cosigner is on the hook. It’s a big request, so take some time to think about how you’ll make it. Here are some tips that may help inform your conversation:

1.    Asking respectfully. You’ll want to broach the subject thoughtfully and respectfully. You’re asking the person for a serious commitment, so asking with tact to show you understand the gravity of your request is crucial.

2.    Showing your dedication. It’s also important to make it clear to your cosigner that you’re going to be making timely payments on the loan. One simple way to do so is by providing them with regular updates.

3.    Illustrating to your cosigner that you understand the intricacies of your loan. They’ll be responsible for the loan if you fail to make payments, so they’ll likely want to make sure you understand the responsibility you’re taking on — and asking them to take on.

💡 Quick Tip: It might be beneficial to look for a refinancing lender that offers extras. SoFi members, for instance, can qualify for rate discounts and have access to career services, financial advisors, networking events, and more — at no extra cost.

Things to Consider if You’re Asked to Cosign a Loan

If you’ve been asked to cosign a loan, be aware that serving as a cosigner can come with consequences for your finances if the primary borrower fails to make payments. If you’re a family member or friend with excellent credit and a well-paying job, you could be a candidate as a cosigner. If you have some hesitation, here are a few steps you can take:

1.    Talking it out with the borrower. The borrower is going to use your name and credit history to take out a loan. It can be helpful to understand why they feel they need a cosigner while making sure they have the means to repay the loan.

2.    Following up often. Keeping the lines of communication open so you are aware of any issues can be helpful for both parties. If need be, you could discuss making payments on their behalf to avoid the effect of a late or missed payment on your own credit score.

3.    Accepting negative outcomes. Even if you’ve done everything you can to ensure the borrower is trustworthy, something might come up where they let you down. Your credit score might take a hit and you might be responsible for making payments yourself. Remember that this could happen, so accepting it as a possibility may be helpful.

Cosigning a loan is a big responsibility that can have implications on your financial future, so take some time to consider if there’s anything you’re not comfortable with.

If you decide not to cosign, you can let the requester down gently by trying to help them think of some alternative options to secure the loan or money they need.

Refinancing Student Loans With SoFi

If you’re interested in refinancing student loans but your credit isn’t strong enough, enlisting a trusted person with a strong financial background as a cosigner may help you qualify for a loan.

But remember: Refinancing federal student loans makes them ineligible for federal programs or borrower protections. If you think you may need these federal benefits, refinancing may not be right for you.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

FAQ

Do I need a cosigner for student loan refinance?

The specific requirements for refinancing a loan with a cosigner will depend on your credit history and income (among other factors) and the eligibility requirements of the lender. Borrowers who have a less than stellar credit history may find adding a cosigner to their application allows them to qualify for a more competitive interest rate.

Can I consolidate my student loans with a cosigner?

If you are consolidating federal loans through the Direct Consolidation Loan program, you don’t need a cosigner.

Can a cosigner become the primary borrower?

In order for the cosigner to become a primary borrower, the loan would generally need to be refinanced.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Student Loan Refinance
SoFi Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org). SoFi Student Loan Refinance Loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Public Service Loan Forgiveness, Income-Based Repayment, Income-Contingent Repayment, PAYE or SAVE. Additional terms and conditions apply. Lowest rates reserved for the most creditworthy borrowers. For additional product-specific legal and licensing information, see SoFi.com/legal.

Can you pay off someone else’s loan? As a general rule, yes — so if you’re a student loan borrower and someone offers you assistance in paying off your loans, you may want to take them up on it. But it’s important to understand the implications. While a parent, grandparent, or even a mysterious benefactor could pay off your student loans, they may be responsible for a gift tax if they contribute more than the annual limit. The gift could also come with emotional strings attached.

Read on to learn about the tax implications of paying off someone else’s student loans — and how to repay your loans if the responsibility is all yours.

Student Loan Repayment

For federal student loan borrowers, the end of the three-year pause on federal student loan payments has made repayment top of mind again. The resumption of federal student loan payments, which was part of the debt ceiling bill President Joe Biden signed into law in early June 2023, requires interest accrual to resume on September 1, 2023, and payments to resume on October 1, 2023. (Borrowers who held private loans did not have any uniform break in payments.)

Additionally, the President’s plan to forgive up to $20,000 in federal student loan debt was struck down by the Supreme Court in late June 2023. That means federal student loan borrowers no longer have that course of action.

The bottom line: If you have a student loan balance, it needs to be paid. If you have a cosigner — which may be the case if you have private student loans or federal PLUS Loans — then that person is legally responsible for repaying the loans if you are unable to do so. But if your student loans are solely in your name, you are responsible for repayment according to the outlined terms.

Getting Help From Your Employer

More employers are offering student loan repayment as a perk. Through CARES Act legislation, employers can contribute up to $5,250 per employee per year toward student loans without the payment counting toward the employee’s taxable income, through 2025.


💡 Quick Tip: Often, the main goal of refinancing is to lower the interest rate on your student loans — federal and/or private — by taking out one loan with a new rate to replace your existing loans. Refinancing makes sense if you qualify for a lower rate and you don’t plan to use federal repayment programs or protections.

Can Parents Pay Off Their Child’s Student Loans?

Yes they can. But can parents pay off student loans without a gift tax? It depends. If a parent is a cosigner, paying the student loans in full will not trigger a gift tax. In the mind of the IRS, the parent is not providing a gift but is paying off a debt.

However, if a parent is not a cosigner, a gift tax could be triggered, depending on how much they pay.

How the Gift Tax Works

The gift tax applies to the transfer of any type of property (including money), or the use of income from property, without expecting to receive something of at least equal value in return, the IRS says — adding that if you make an interest-free or reduced-interest loan, you may be making a gift.

There are some exceptions. Gifts between spouses aren’t included in the gift tax. That means if you are married and your spouse pays off your loans, that would not trigger a gift tax event. (The IRS includes lawfully married same-sex couples.)

Tuition paid directly to qualifying educational institutions in the United States or overseas is also not subject to gift tax. But student loans are different.

The annual exclusion for gifts is $17,000 in 2023. That means an individual can give you up to $17,000 without triggering the gift tax, which the givers, not receivers, generally pay. If your parents file taxes jointly, they would be able to give a combined $34,000 a year, which could include paying down loans. Borrowers who have the good fortune to snag $17,000 from Mom, Dad, Granddad, and Grandma could get a total of $68,000 without any family member having to file a gift tax return.

Note, though, that even a gift of more than $17,000 towards your student loans doesn’t mean that your generous benefactor is on the hook for paying a tax on their gift. The excess amount just gets added to the lifetime exclusion — currently set at $12.92 million. As long as the benefactor’s total lifetime gifts are below that amount, they don’t have to worry about paying a gift tax. Still, if bumping against that lifetime exclusion is a concern, they can spread out their support over the years to avoid gifting you more than $17,000 in a calendar year.

The upshot is that the main concern when it comes to helping children out with their student loans is probably not the gift tax, but whether the parent can afford it. It’s a good idea for parents to consider their retirement plans and test what-ifs before offering to pay their children’s student loans. Working with a financial planner may help parents find a path that works for them and their children.

It’s also not an all-or-nothing decision. Some parents choose to pay a portion of student loans or offer cash toward repayment in lieu of other gifts.

Recommended: Should Parents Cosign on Student Loans?

What Happens When Someone Pays Off Student Loans For You?

A person can pay off student loans for you in a couple of ways:

•   Pay the lender directly

•   Pay you, with the expectation you will pay the lender

But if someone pays off your debt, is that income? Once another person has paid off your student loans, it’s as if you had paid them off yourself. You would not have any tax liability.

Other Options to Pay Off Student Loans

Not everyone has a benefactor, of course. While someone taking your student loan balance down to zero can seem like a dream, there are realistic ways to ease the burden of student loans, no third party required.

These strategies include student loan consolidation, student loan refinancing, and in some cases, student loan forgiveness.

The one thing that won’t help: if you stop paying your student loans. Ignoring your student loan payments will result in an increased balance, additional fees, and a lower credit score.

If you hold federal student loans and stop paying them, part of your wages could be garnished, and your tax refund could be withheld. If you default on a private student loan, the lender might file a suit to collect from you.

In other words, coming up with a repayment plan is crucial.


💡 Quick Tip: When refinancing a student loan, you may shorten or extend the loan term. Shortening your loan term may result in higher monthly payments but significantly less total interest paid. A longer loan term typically results in lower monthly payments but more total interest paid.

What Is Student Loan Consolidation?

If you have federal student loans, you may consider consolidation, or combining multiple loans into one federal loan. The interest rate is the weighted average of all the loans’ rates, rounded up to the nearest one-eighth of one percentage point.

Federal student loan consolidation via a Direct Consolidation Loan can lower your monthly payment by giving you up to 30 years to repay your loans. It can also streamline payment processing.

Consolidating federal loans other than Direct Loans may give borrowers access to programs they might not otherwise be eligible for, including additional income-driven repayment plan options and Public Service Loan Forgiveness.

What Is Student Loan Forgiveness?

Although President Biden’s federal forgiveness program was blocked by the Supreme Court, there are still several paths toward student loan forgiveness for federal student loan holders. They include:

•   Income-based repayment. Federal income-driven repayment plans promise loan forgiveness after a certain amount of time, depending on the plan.

For instance, under President Biden’s new SAVE Plan, which is based on income and family size, qualifying federal student loan borrowers with undergraduate federal loans can get their monthly payments reduced by half — from 10% to 5% of their discretionary income. And after 10 to 20 years of making payments (the number of years depends on how big their original student loan balance was), the remainder of what they owe will be forgiven.

•   Public Student Loan Forgiveness: This federal program was designed to help graduates working in public service have any remaining loan balance forgiven if they meet criteria that include working for a qualifying organization and making 10 years’ worth of payments.

•   Disability discharge: Some people may have their loans forgiven because of total and permanent disability.

What about bankruptcy? It’s extremely difficult to have student loans discharged through bankruptcy.

What Is Student Loan Refinancing?

With student loan refinancing, a borrower takes on one new, private student loan to pay off previous federal and/or private student loans. Ideally, the goal is a lower interest rate. The repayment term might also change.

However, there is a very important caveat for those with federal student loans: Refinancing those federal loans means that borrowers will no longer be eligible for federal repayment plans, forgiveness programs, and other benefits. If a borrower needs access to those programs, student loan refinancing won’t make sense.

But for borrowers who have no plans to use the federal programs, a lower rate could make refinancing worthwhile. Using a student loan refinancing calculator can help a borrower see how much money they might save by refinancing one or all of their loans.

Refinancing Student Loans With SoFi

Even if your parents, grandparents, or others in your life are not in a position to pay off your student loans for you, understanding your options for potentially lowering your monthly payments or saving money over the life of a loan can give you multiple avenues to explore as you work toward taking control of your finances.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

FAQ

Can I pay off my child’s student loans?

Yes, you can pay off your child’s student loans. But, depending on the amount, there may be tax implications.

Is paying off a child’s student loans considered a gift?

Yes. Paying student loans for someone else is considered a gift and would incur a gift tax for any gift above $17,000, which is the gift exclusion cutoff for 2023.

That means both parents can contribute $34,000 per calendar year toward their child’s student loans without owing gift tax.

Can I pay off my sibling’s student loans?

Yes. You can absolutely win sibling of the year and pay off your sibling’s student loans. Just know that any gift above $17,000 in 2023 will trigger a gift tax that you will be responsible for paying.

Photo credit: iStock/Halfpoint

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Student Loan Refinance
SoFi Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org). SoFi Student Loan Refinance Loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Public Service Loan Forgiveness, Income-Based Repayment, Income-Contingent Repayment, PAYE or SAVE. Additional terms and conditions apply. Lowest rates reserved for the most creditworthy borrowers. For additional product-specific legal and licensing information, see SoFi.com/legal.