I am not kidding. If your child needs to go buy a car (can’t afford to pay cash) and the bank won’t loan them money why should you? They have to learn the hard way.
If you live in a city they can take the bus. That’s right-take the bus. People today are buying their kids cars when they graduate from high school. When I graduated from high school, I had a friend who came from a family of 23 kids. What did he get for graduation? As suitcase! Hint, hint-time to move out!
When you cosign here are the facts:
1. You are being asked to guarantee this debt. If the borrower does not pay the debt-you do!
2. You may have to pay up to the full amount if the debtor does not pay. You may have to pay for late fees or collection costs.
3. The creditor can decide to collect directly from you without going to the borrower.
4. The creditor can use the same collection techniques against you that they would use against the borrower.
If you feel that you really must cosign for your kids consider the following:
1. Make sure you can repay the loan yourself.
2. Try to limit your liability with the creditor. They may be flexible with the loan.
3. Ask to be notified in writing if the borrower fails to make even one payment.
4. Make sure you get copies of all paperwork including payments and balances.
Cosigning may not seem like a big deal but it could ruin your credit forever!
Jacques
CreatingWealthThatLasts
2 comments:
Jacques, you are so right. They could ask for the full amount all at one time. They may not give you the option of payments, if the other party does not pay. That could make a hardship on you if you do not have it.
Dan and Deanna "Marketing Unscrambled"
Hi Jacques .. I agree with you and with Deanna and Dan .. make a plan yourself to pay for it yourself .. not bring others in ..
Thanks - Hilary Melton-Butcher
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