What You’re Responsible for as a Co-Signer | Richard Banks & Associates, P.C.

Chances are, you’ve had a friend or family member ask you to co-sign a loan. If you did in fact agree to be a co-signer, hopefully the person you signed for has proven to be good on that loan, otherwise you may be needing our services at Richard Banks & Associates, P.C. in the very near future.

Before you agree to become a co-signer, the lender is required to fully spell out your obligation to the loan, so you never go into the process “in the dark.”

When you co-sign for someone, you’re guaranteeing the debt, so if your friend or family member falls through, you will be on the hook for his or her debt. The creditor can—and will—collect late fees and collection costs from you and may even hold you responsible for paying the full amount of the debt up front. You can ask the creditor to notify you if the person you’ve co-signed for has missed a payment or if the terms of the loan change.

Consider these things before becoming a co-signer:

1. Can you afford to pay this loan in full?

2. Will co-signing on this loan keep you from getting other credit?

3. Is the person asking you to co-sign someone who has proven to be reliable and trustworthy?

If you and the person you co-signed for find yourselves in a difficult financial situation and are becoming overwhelmed by the loan payments, Richard Banks & Associates is here to help you. You don’t have to navigate the murky and rough seas that debt can produce alone!