You are hoping that your friend or relative will pay back the loan. There’s a good chance that it will not happen. When your friend or relative defaults, then you have the “privilege” of paying back the money. My advice is to never co-sign a note unless you can afford

You Risk Ruining Your Credit Rating When you cosign a loan, your credit is affected immediately. Does this shock you? You see it doesn’t matter that the loan may eventually be paid in full by the initial borrower. Your credit will be affected the minute you sign the paperwork. How

The Odds Are Against You Statistics show that the cosigner winds up paying for nearly three out of four cosigned loans that end up in default. The lender can go directly to the cosigner, bypassing the original applicant immediately. Furthermore, all the typical methods available to the lender for debt

Friendship and Relationships One of the reasons people consider helping a friend or relative is to be a nice person. But ask yourself this. How long is the friendship going to continue if you are always asking whether or not the person has made the loan payment. Even if you

Proverbs 17:18 “A man lacking in judgment strikes hands in pledge and puts up security for his neighbor.” This scripture clearly warns us of the danger involved in providing collateral, security or surety for another person. One very quick way of going into debt is by cosigning someone else’s loan.

Let me explain what you are doing if you cosign a note. You are loaning the money you borrowed to a person who was too great a risk for the professional lender. You are involving yourself in a business transaction that the expert money manager would not touch. If the

You may argue that you need to cosign a loan for an offspring so that he / she can establish good credit. While it does seem admirable for a parent to help their children get established, think about what your potential action is saying to them. If you are cosigning

You Become the Borrower When you cosign a loan, know that you are now being asked to guarantee the full amount of the debt. The lender has refused to make the loan to the person for whom you are cosigning. The lender’s decision has been based on facts that reveal

A Vacuum of Information You may not be notified should the borrower miss a payment. Time after time the loan payment may be missed and as a cosigner, you may never know. That is until the loan is in default and the collateral has been repossessed. By that time, it