Dear Dr. Don,

I was dumb enough to co-sign some student loans for a friend. Luckily, she hasn’t defaulted yet. I don’t want to risk that anymore, especially since I don’t talk to her anymore. I am wondering what my options are for removing myself as the co-signer. Can a statement agreement get me off? What about having her refinance the loan?

— Cole Credit

Dear Cole,

When you co-sign a loan, you’re taking on a risk that the lender wasn’t willing to take. Your options depend on the loan documents, her current credit history and the type of student loan — government or private.

Some private student loans allow the co-signer to be removed from the loan if the student has made a certain number (typically 12 to 24) of consecutive monthly payments on time and meets the lender’s credit standards and other requirements for a co-signer release.

If a co-signer release won’t work, then her refinancing the loan is the best way for you to shed the risk. However, for that to work, her credit history has to be good enough to qualify for the refinancing or she needs to find another co-signer.

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