Daily Dupaco

Thursday, December 17, 2009

Know the risks that come with co-signing

More stringent requirements has led some credit card companies to require a co-signer. Before you agree to co-sign, whether it be for family or friends, be sure to read the fine print, discuss it with the cardholder, and know what you're liable for by signing.

As a prospective co-signer, you may not realize that:
  • The debt may be yours. If the cardholder can't or won't pay, you're next in line. And a card issuer wouldn't ask for a co-signer if it thought it could collect from the cardholder.
  • Your credit score could drop. If the cardholder can't make the payments, that person's credit rating--and yours--is affected. And, that ding on your credit report could mean that your own loan application is denied.
  • You could be sued. If the cardholder you cosign for ends up with thousands of dollars of debt, the credit card company takes that person--and you--to court to collect. You have to reveal all your assets and risk losing them to pay for purchases you didn't make.
Click here to read the entire Home & Family Finance article.
Comments (0)

Post a Comment

Please provide your information. Name and email address are required. Email address will not be displayed with the comment.
Comment Title:
Please enter the code shown in the image

Thank you. Your comment is being reviewed and if approved, will be posted shortly.

Related Content
Daily Dupaco Archive
Dupaco's VISA credit card has a low rate for six months