Education Loan Co-applicant Guide
Who can be a co-applicant, why banks insist on one, credit-score impact and what happens if they cannot pay.
Updated 29 September 2026 · 8 lenders trackedWhat you need to know
Every education loan needs a co-applicant (co-borrower), usually a parent or guardian. The co-applicant is jointly responsible for repayment, and the loan shows up on their credit report as well as the student’s.
Who can be a co-applicant
| Co-applicant | When accepted |
|---|---|
| Parent or legal guardian | Default choice at all banks |
| Spouse or parents-in-law | For married students |
| Sibling or other close relative | Accepted by some lenders (especially NBFCs) if parents cannot |
| Third-party guarantor | Not needed up to ₹7.5 lakh under CGFSEL; may be asked for in other cases |
What the lender checks
- Credit score and repayment history — defaults or settled loans are red flags
- Income and existing EMIs (for larger or unsecured loans)
- Ownership of collateral for secured loans
- KYC and relationship proof
Responsibilities and risks
- Helps the student get a loan without own income
- Can claim Section 80E if the co-applicant is the borrower who pays the interest
- Timely repayment builds credit history for both
- Missed EMIs hurt the co-applicant’s credit score too
- Co-applicant is legally liable if the student cannot pay
- The loan counts in their future loan eligibility (e.g. a home loan)
Frequently asked questions
Can a retired parent be a co-applicant?
Yes. Income is less important for loans up to ₹7.5 lakh; for larger loans the bank may want collateral or another earning co-applicant.
Who claims the 80E deduction — student or parent?
The individual who has taken the loan and pays the interest. If the loan is in the student’s name and the student repays, the student claims it; if the parent is the borrower and pays, the parent claims it.
For information and comparison only. Loan terms, rates and rules change — confirm with the lender and read the Key Facts Statement before borrowing.