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Spouse Student Loan Consolidation vs. Cosigning Your Spouse’s Refinance

Ben Luthi

Federal student loan
Payments Return April 30

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Federal student loan
Payments Return January 31

We've got you covered.

Get Purefy’s free 20-page Ultimate Guide with just one click.

If you’re married, combining your finances can simplify a lot of things — and in some cases, it can even help you save money.

Spousal student loan consolidation makes it possible to do both.

If you’re looking to consolidate student loans with your spouse, however, it’s important to consider all of your options before moving forward. Here’s what you need to know.

What is spousal student loan consolidation?

A spouse student consolidation loan is only available from PenFed Credit Union. It allows you to combine your student loan balances and pay them off on one account instead of two.

PenFed’s Spouse Loan allows you to combine loans from both partners during the application process, something you can’t do in any other refinancing scenario.

The lender combines your income and debts to determine whether you’re eligible for the new loan, and the interest rate is based on the higher of your two credit scores and degrees.

Here are some pros and cons of spousal student loan consolidation.


  • Get better terms together: If one spouse has a significantly higher income and credit score, a Spouse Loan can help the couple take advantage of this difference and make it easy to get approved for a low interest rate.
  • Simplify your money situation: With a Spouse Loan, you only have one monthly payment to keep track of instead of multiple. This can be especially beneficial if both spouses have more than one loan servicer.


  • Potential issues if you divorce: PenFed’s Spouse Loan has repayment terms ranging from five to 15 years, which is a potentially long time to have shared debt. If you decide to divorce in the future, you may be required to split the debt equally, even if one partner had significantly more debt than the other in the beginning.
  • Both credit scores are at stake: Because you’re both on the new loan, missing a payment could damage both of your credit scores instead of just one spouse’s if you had kept the loans separate.
  • There’s no guarantee: Even if one spouse has a solid income and credit history, it’s not an assurance that you’ll be eligible for better loan terms than what you have with your existing lenders.

What is cosigning your spouse’s student loan refinance?

While spousal student loan consolidation involves combining student debts from two people into one account, cosigning your spouse’s student loan refinance leaves your student loans separate.

When you cosign for your spouse, you’re adding your name to their application and guaranteeing you’ll make payments if they can’t. As a result, that debt will show up on your credit report, and it will damage your credit if you or your spouse misses a payment.

As with spousal student loan consolidation, there are both benefits and drawbacks to cosigning a refinance loan.


  • Get better terms: As with a Spouse Loan, cosigning your spouse’s refinance loan can help them score a lower interest rate than they would be able to on their own. This is especially the case if they have bad or fair credit and little or no income.
  • It’s possible to release a cosigner: If the primary borrower improves their credit history and income situation over time, some lenders offer an opportunity to remove their cosigner from the loan. If eligible, a cosigner release program can be especially beneficial during divorce negotiations.


  • One spouse takes on more responsibility: While both partners are equally responsible for making payments on a Spouse Loan, a cosigning spouse is responsible not only for their own debt but also the debt of their partner — and that can be an especially tricky situation if you get divorced in the future.
  • Credit implications: If you miss a payment on the cosigned loan, it will affect both your credit scores. However, if the cosigning spouse misses a payment on their own loan, it’ll only impact their credit report.

Is Student Loan Refinancing Right for You?

Find out how much you can save with these top lenders

Refinance Student Loans With Your Spouse

Fixed Rate

2.89% – 4.98% APR​

Variable Rate

Not Offered

Precision Pricing — Pick Your Monthly Payment

Fixed Rate

2.44% – 5.79% APR

Variable Rate

1.74% – 5.64% APR
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Fixed Rate

2.49% – 6.94% APR with autopay

Variable Rate

1.74% – 6.59% APR with autopay

When to cosign a spouse’s refinance and when to consolidate together

While it’s not fun to talk about, divorce can complicate things, so if you have even an inkling that your marriage may be in trouble, it’s best to avoid both options as it can cause future financial problems.

If you feel like your marriage is safe, spousal student loan consolidation may be a good option if your debt balances and interest rates are relatively similar. If there’s a significant difference in either your balances or interest rates, you may benefit from working to pay off the loan with the higher interest rate or lower balance first to accelerate the debt payoff process.

It’s especially important to avoid a Spouse Loan if one spouse has a lower interest rate than what the new loan would provide. In that case, you may end up paying more in interest, and it may be better for that spouse to cosign their partner’s refinance loan to help them get a lower rate, too. You could also just exclude the lower-interest loans from the refinance, and only include the loans you will save on.

Regardless of which option you choose, it’s crucial to have a conversation with your spouse about both options to determine which one is right for you.

Talk about the advantages and disadvantages of both options, as well as your financial situation and goals, to help you make the best decision for your family.

Shop around to maximize your savings

No matter which path you’re considering, it’s crucial that you compare rates and other terms with several lenders before deciding.

It’s especially important to do this if you’re thinking about spousal student loan consolidation because a Spouse Loan is only available through PenFed Credit Union. This means that you don’t have any other lenders to compare to determine if you’re getting the best terms you qualify for.

By comparing the Spouse Loan with cosigning options with other lenders, you’ll have a better idea of what rates you can get with both options, which can help you make the right decision for your family. Use Purefy’s Compare Rates tool to simplify this process and view rate quotes from multiple lenders in one place — with no impact on your credit score.

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