Loan Default Consequence

 

What happens if the person with whom you cosigned a note refuses to pay or misses a payment.  In most states in this country, should a friend, relative or acquaintance miss just one payment, the lender can immediately go to you the cosigner and immediately collect from you WITHOUT FIRST looking to the borrower of the money.

 

The lender may or may not look to the original borrower to get the money.  There is a very good chance that they will look first to you, the cosigner of the loan.  “Why?” you ask.  The reason the original borrower of the money was not credit worthy and represented a great risk to the lender is how you came into the picture in the first place.  You, as a cosigner, actually made it happen.  You made the loan possible.

 

 

Your thoughts on this subject?  Your comments appreciated!

 

Content © Rich Brott, 2011

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