Скачать или смотреть COSIGNER WARNING: Is It A Good Idea To Cosign A Loan? Assets vs Liabilities

Is it a good idea to cosign a loan?

Well, that depends.

Let's start off by defining cosigner:
A co-signer is a person - such as a parent, spouse, close family member or friend – who pledges to pay back the loan if you do not. A co-signer is a person who is obligated to pay back the loan just as you, the borrower, are obligated to pay.

Common Types of Cosigning Loans:
Personal Loans
Auto Loans
Credit Cards
Home-Equity Loans
Small Business Loans

If you're cosigning on a loan for an asset like a real estate property...to me that makes more sense, especially if you're building out your investment portfolio.

BUT if you're cosigning a loan for a depreciating asset such as a car...that does not make any sense. DON'T DO IT. It's not worth it. The car loses value the moment you drive it off the lot and continues to lose value as time goes on.

By guaranteeing a loan for someone you're taking on way too much of a risk. Really, really, think about it before you sign that dotted line. Remember, if the borrower doesn't make the payments, you are ultimately fully responsible for that loan, even if you don't drive the car. If you co-sign a loan, you will have limited credit flexibility if either party is can't make those monthly payments.

Listen, I know it ain't easy saying no to a loved one. Believe me, I've been there done that. But you have to express your decision from a place of love and respect. Educate your loved one on prioritizing their Wants vs. Needs.

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