Co-Applicant

DEFINITION of 'Co-Applicant'

An additional person seeking to obtain a loan with a primary applicant. One reason a potential borrower might want a co-applicant is to increase his odds of qualifying for a loan or to qualify for a larger loan. A co-applicant is also desirable if the loan is for the purchase of property that will be owned equally by both borrowers, such as business partners or spouses.

BREAKING DOWN 'Co-Applicant'

For example, when a husband and wife apply for a loan, one will be listed as the primary applicant and the other will be listed as the co-applicant. The lender will examine the debt, credit scores and overall financial picture of both the primary applicant and co-applicant in deciding whether to extend the loan. If the loan is granted, the applicants will become co-borrowers, and each will be equally responsible for its repayment.

RELATED TERMS
  1. Direct Consolidation Loan

    A loan that combines two or more federal education loans into ...
  2. Character Loan

    A character loan is a type of unsecured loan that is made on ...
  3. Loan Officer

    Representatives of banks, credit unions and other financial institutions ...
  4. Standing Loan

    A type of loan where payments are made of interest only. Repayment ...
  5. Refinance

    1. When a business or person revises a payment schedule for repaying ...
  6. Renegotiated Loan

    The result of an agreement between a borrower and a lender to ...
Related Articles
  1. Personal Finance

    Personal Loans vs. Car Loans

    How to tell whether a personal loan or a car loan is better for you.
  2. Managing Wealth

    When Are Personal Loans a Good Idea?

    You never want to borrow money for frivolous reasons, but these five circumstances might warrant it.
  3. Personal Finance

    How To Apply For a Personal Loan

    Learn about different avenues for applying for a personal loan, and learn valuable tips to help you get your personal loan application approved.
  4. Personal Finance

    Understanding Loans

    A loan is the act of giving money, property or other material goods to another party with the expectation of being repaid.
  5. Investing

    Different Needs, Different Loans

    Find out what options are available when it comes to borrowing money.
  6. Markets

    Tips To Improve Chances Of A Small Business Loan

    Enhance your small business loan eligibility by keeping these important tips in mind.
  7. Markets

    All About Government Loans

    There are many reasons to seek a government loan rather than one from a private lender. Government loans typically have low interest rates and offer fixed or subsidized options, as well as deferred ...
  8. Personal Finance

    College Loans: Private vs. Federal

    Not all student loans are the same. Know what you're getting into before signing on the dotted line.
  9. Managing Wealth

    Unsecured Personal Loans: 8 Sneaky Traps

    If you are seeking a personal loan, be aware of these pitfalls before you proceed.
  10. Investing

    Understanding Term Loans

    A loan from a bank for a specific amount that has a specified repayment schedule and a floating interest rate.
RELATED FAQS
  1. Are secured personal loans better than unsecured loans?

    Read about the differences between secured loans and unsecured loans and how they are used. Learn about forms of collateral ... Read Answer >>
  2. What are the differences between delinquency and default?

    Find out more about loan delinquency, loan default, and the difference between a loan borrower defaulting and being delinquent ... Read Answer >>
  3. What are the typical requirements to qualify for closed end credit?

    Learn what closed-end credit is, and the various requirements that borrowers must meet in order to obtain a closed-end credit ... Read Answer >>
  4. What are the pros and cons of life insurance policy loans?

    Find out the pros and cons of borrowing against your life insurance policy to help you decide if this loan type is the right ... Read Answer >>
  5. What is the most important "C" in the Five Cs of Credit?

    Learn how the five C's of credit affect new credit application decisions, and understand how a lender analyzes each aspect ... Read Answer >>
  6. I am considering taking a loan from my qualified retirement plan. What is the definition ...

    For the purposes of a qualified plan loan, the reasonable rate of interest that the Department of Labor provides is one consistent ... Read Answer >>
Trading Center