2007-11-06 04:20:53 · 3 answers · asked by John S 1 in Education & Reference ➔ Financial Aid
A cosigner is guaranteeing the debt. That means you will have to repay the loan if the borrower does not. It’s critical that you understand and want to accept this responsibility and that you are aware of the following:
* Be sure you can afford to repay the loan. If you’re asked to pay and you cannot, you may be subject to collections efforts and your credit rating could be damaged.
* Even if you’re not asked to repay the debt, your liability for it may be included in computing your debt-to-income ratio and may prevent you from getting approval for other loans.
* Under federal law, creditors are required to give you a notice that explains your obligations as a cosigner. In addition, make sure you get copies of all important papers, such as the loan contract and the Truth-in-Lending Disclosure Statement.
2007-11-06 07:26:57 · answer #1 · answered by Anonymous · 1⤊ 0⤋
As long as the person who is the main on the loan pays the payments on time, your credit will be okay...but if they miss payments, then you are responsible for them as well, and your credit score is affected just as much as theirs is.
Your credit score determines how much loans, credit cards, etc. you can get...you need to keep it above 650 at least.
2007-11-06 05:15:38 · answer #2 · answered by SisterSue 6 · 0⤊ 0⤋
NEVER NEVER NEVER cosign for a loan. If the person defaults you are responsible for the loan, and yes it will affect your credit.
2007-11-09 16:52:17 · answer #3 · answered by John 3 · 0⤊ 0⤋