Ameritech Financial: Is It Easier for Private Student Loan Lenders to Offer Cosigner Release Than to Give It?

Daughter Thanking Father for Helping with Loans

Nearly 90 percent of private in-school loans are cosigned. Many of those are advertised as having a “cosigner-release” option — where a cosigner can be released after a certain number of on-time payments are made by the primary borrower. Despite this promise, a recent study by the Consumer Financial Protection Bureau found that 90 percent of cosigner release applications were rejected by lenders. It turns out that it is easier for lenders to promise cosigner release than it is for them to actually give it. Unfortunately for borrowers, this means that for a decade or more, both signers and cosigners must shoulder the burden or threat of student loan debt. Ameritech Financial, a document preparation company, cannot help borrowers with their private loans, but it can assist those overwhelmed with federal student loans apply for and maintain enrollment in federal loan repayment programs, such as income-driven repayment plans (IDRs).

“It would be great if well-meaning parents or relatives who cosign could get off the hook for a private student loan as advertised, but apparently it’s more difficult than that,” said Tom Knickerbocker, executive vice president of Ameritech Financial. “For those who find keeping up with their federal loans more difficult than they hoped for, IDRs are sometimes a great option, possibly lowering monthly payments based on income and family size.”

For those who find keeping up with their federal loans more difficult than they hoped for, IDRs are sometimes a great option, possibly lowering monthly payments based on income and family size.

Tom Knickerbocker, Executive Vice President of Ameritech Financial

Though programs vary greatly, most say they are eligible for cosigner release after a borrower has made 12 or 24 consecutive on-time payments. The process is similarly varied, but usually asks applicants to, in addition to keeping up with payments, provide proof of graduation, citizenship, income and pass a credit review. Unfortunately, even those who successfully leap these hurdles are routinely deemed ineligible.

Perhaps the main reason for this is that most cosigner releases can be more accurately called refinancing options — where the loan is refinanced solely by the primary borrower. This is due to securitization. Many lenders collateralize and securitize student loans into bundles which are sold to investors. Because they have already been agency-rated, many lenders don’t allow a loan to change, which would change the entire bundle. These lenders refinance rather than modify the loan. Cosigner release is jeopardized since most primary borrowers, rather than having to simply keep up with their loan as advertised, must qualify on their own. Most student loan borrowers, by definition, have too much debt to qualify. At least one finance expert somewhat unhelpfully suggests that, if denied a cosigner release, borrowers should shop around for refinance options for their student loans.

“Student loan debt is an incredibly complicated form of debt,” said Knickerbocker. “We take the complication out of it if you have federal loans. We will help you determine if you qualify for an IDR and, if you do, which one maximizes your benefit. If we are able to lower your payment, we can then help you with recertification for the life of the loan, possibly ending in forgiveness in 20 or 25 years.”

About Ameritech Financial

Ameritech Financial is a private company located in Rohnert Park, California. Ameritech Financial has already helped thousands of consumers with financial analysis and student loan document preparation to apply for federal student loan repayment programs offered through the Department of Education.

Each Ameritech Financial telephone representative has received the Certified Student Loan Professional certification through the International Association of Professional Debt Arbitrators (IAPDA).

Ameritech Financial prides itself on its exceptional customer service.

Ameritech Financial Newsroom


To learn more about Ameritech Financial, please contact:

Ameritech Financial
5789 State Farm Drive #265
​Rohnert Park, CA 94928

Source: Ameritech Financial

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About Ameritech Financial

Ameritech Financial is a document preparation company that helps borrowers enroll in the federal repayment program that matches their individual financial needs, potentially lowers payments and gets them on track for student loan forgiveness.

Ameritech Financial
5789 State Farm Drive, 265 , #265
Rohnert Park, CA

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