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What Is a Cosigner?

Last Updated: September 25, 2024

5 min read

Table of contents

Key Points:

A cosigner on a credit card could help the main borrower access credit.
A cosigner takes responsibility for paying back a loan if the primary borrower doesn’t pay the debt.
Most major credit card issuers don’t allow cosigners but do allow adding an authorized user to an account.

If you’re applying for a credit card for the first time or trying to rebuild your credit, you may have difficulty being approved by a credit card issuer. But, with a consigner, some borrowers may have a better chance of approval for a credit card.

Cosigning may be more common for a loan (like a personal loan, mortgage, or auto loan) than a credit card. But it can be helpful to understand what a cosigner is and how you can access credit if your credit card issuer doesn’t allow cosigners.

What is a cosigner on a credit card?

Sometimes a credit applicant (the main borrower), doesn’t get approved for a credit card. In this situation, a cosigner on the credit card acts as a guarantor to minimize the risk for the credit card company. If the main borrower doesn’t pay, the cosigner is responsible to pay any missed payments or even the total amount of the loan.

A cosigner takes on the responsibility for paying back a loan if the card holder doesn't pay their bills (according to the loan agreement).

A cosigner is usually a family member or friend that has shown responsible credit use on their credit report. A creditworthy cosigner should have a stable income, good credit, make their monthly payments on time, and doesn't show a missed payment on their credit report.

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A credit card cosigner is different from a joint account holder. A cosigner is the default debtor if you fail to make your payments. With a joint credit card, you are both primary cardmembers and are responsible for the debt at all times.

Benefits of a borrower having a cosigner

There are a few benefits of having a cosigner on a credit card.

Better chance of approval

One advantage to having a cosigner is that it may improve your chances of getting approval for a credit card or loan. That's because, typically, a cosigner has a steady income, a good credit score, and takes responsibility for paying your credit card debt if you default. The cosigner’s credit score should probably be very good or excellent.

More favorable credit card terms

When your cosigner has a credit history and steady income, you may be able to obtain a lower interest rate or a card with rewards.

Build credit history

Getting a credit card could allow someone with no credit to build their credit history. Credit cards may help someone rebuild their credit and credit score by using their card responsibly.

Disadvantages of being a cosigner

While the primary borrower is in charge for making credit card payments, there are a few risks to consider before becoming a cosigner on a credit card.

Late payments

If the borrower makes a late payment (or fails to make payments), the cosigner is responsible for the outstanding balance. A late payment or missed payment could impact the cosigner’s credit score if the credit card issuer reports the delinquency to a credit bureau.

New credit

The cosigner may have difficulty getting a new line of credit because a lender may think the cosigner’s debt level is too high, as per the Federal Trade Commission (FTC). And if the cosigner wishes to remove themselves from the account, it could be difficult, the FTC goes on to explain.

How to get a credit card without a cosigner

Most major credit card issuers don’t allow cosigners. Cosigning is more common for loans like a personal loan, student loan, mortgage loan, or car loan. But, if you’re having trouble getting a credit card on your own due to poor credit or no credit history, you can consider a few other options.

Become an authorized user

One way you can access credit and start to build credit history (or rebuild credit history) is as an authorized user on someone else’s credit card account. Authorized users get their own credit card with their name on it, but the primary account holder is responsible for the bill.

Being an authorized user can help you build credit history, but you’ll want to ensure the cardholder pays their bills on time. If the card holder makes a late payment (or misses one), that could appear on your credit report, too.

Get a secured credit card

Secured cards can help you build or rebuild your credit when used responsibly. A secured credit card is a credit card secured by a cash deposit. The deposit helps reduce risk for the credit card issuer if you fail to make payments.

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The Discover It^® Secured Credit Card can help you build your credit history with responsible use¹ or rebuild your credit with responsible use.¹

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Apply for a student credit card

If you're a student and meet the credit card company's conditions, you could apply for and get approval for a student card. Some student credit cards, like the Discover it^® Student Chrome, don't require a credit score to apply, so you're more likely to qualify even with no credit history.

Although cosigners for credit cards aren’t common, there are still a few ways to access credit if you have a limited credit history (or no credit at all). Some risks are involved for the cosigner on a credit card, but it could also help the primary borrower gain access to credit or more favorable credit card terms.

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