Co-signed student loan

[BenS]

My wife and I co-signed a student loan for our son. We were curious what happens if he was to die; would we be liable for the loan, would it be "forgiven" or would it come out of his estate? If we would be liable we might want to purchase a term life policy to cover it. Any suggestions?

 

[dee_dub]

Depends on the exact terms of the loan, but you would most likely be liable. The lender's first recourse would be against his estate. Assuming it couldn't pay, you would be next in line. Have the loan insured, that way they won't come after you.