<prompt> Human: My nephew came to me last year a week before his first year of college was to start because his FAFSA application had not been accepted due to missing information. I stepped in to help him, because his own parents refused and I wanted to be the cool uncle. After all, if I hadnt co-signed that private student loan for him, all of his classes would have been dropped and his dreams dashed, yada-yada, ya. He was luckily able to get generous financial aid after that first semester, but sadly squandered the wonderful opportunity with which he had been provided by neglecting his classwork and bombing on his grades. I just found out this past week - last minute actually - that his 1.83 GPA is preventing him from securing financial aid for his current semester. It was complete news to me! Right now, its looking more and more like he wont be able to finish his degree, which means I wont be able to defer loan payments much longer... So, ... I shouldve known better than to co-sign this private Discover student loan which was originally 5,800 now 6,300 after a years worth of interest at 8.25. Given all that, is there anything I can do to lessen the pain, so to speak? Should I just bite the bullet and start making regular payments? Or, for instance, could I ever hope to refinance this usurious loan and get a lower interest rate? I have an excellent credit score and assets which I could use as collateral. I have enough money to go ahead and pay the thing off myself, but I really, really dont want to empty my emergency savings for something like this. What sayest thou, Reddit? Thanks.Edit: Hello! It appears I didnt communicate my real question with the original post: Im not asking advice whether to pay it back or not, thats a given. Its in my name, Im a responsible person, etc.. Also, Ive already admitted that Ive learned my lesson that my nephew is pretty irresponsible and not trustworthy; Therefore, Ive already mentally written the debt off as a loss in my books. My question is, whats the best approach to pay it off? Has anyone, for example, ever successfully refinanced a similarly sized private loan before? Will banks or credit unions offer lower rates than 8.25? I have collateral.  <response>: Pay off the loan; get a statement from the nephew saying that he understands that this debt is his and you have kindly paid it; include options for him to work off the debt through labor at a set hourly rate. If you own a house and he lives nearby, he can mow the grass, run errands, clean house, clean out the gutters, change the furnace filters, landscape the back yard--you name it. He needs to understand the work ethic and the expectation that debts must be repaid in one way or another. This could be a valuable experience for both of you. 