Don’t co-sign!

I know you think he are she is the one…

or you guys have been friends for years…

And they need your help in order to get approved on a loan. They’ve been there for you and you’ve got to be there for them, right?

Not when it comes to cosigning for a loan.

A cosigner goes on the loan because the one applying for the loan cannot get approved on their own. The bank views them as too much of a risk to loan them a lot of money…& you should too!

Because if you sign on the loan with the other person (co-sign), you are now legally obligated to pay that loan back even though they’re the ones using it. 

Oh and the banks don’t care either. They don’t care who got laid off…they don’t care y’all had a falling out, or that he tried to hook up with your girlfriend. The only thing they care about is making that payment and if it doesn’t come from “them” then it’s gonna come from you.

If you don’t, they’ll report it as a missed payment and you’ll be on your way to ruining your credit. One missed payment can drop your credit score as much as 100 points. The banks use a scoring model to assess risk and the higher the risk, the higher your rate. So Jeb misses a payment (with the excuse of “Oh, I forgot.”) and then when it comes time for you to apply for a loan because you want to treat yourself, the bank sees that missed payment (s) and either denies you or puts some extra juice (interest) on the repayment of the loan.

You did your part. Jeb didn’t do his and now you have to suffer-oh and he doesn’t because he’s not on the new loan that you’re trying to get. You get all of Jeb’s backlash for years to come!

Don’t co-sign. If y’all fall out because you refuse to do so, then consider it a blessing in advance. Maybe y’all weren’t as thick and thin as you’d hoped. Besides, Uncle Marsh would rather y’all fall out over a decision versus falling out over a bunch of missed payments.

TSL Jr. Bullets:

  1. Say no. Period. And you  don’t owe an explanation either. If ya’ll fall out because of your refusal consider it a favor. It takes minutes to find a friend, but it takes years to rebuild your credit. 
  2. If you want to help, I’d rather you loan them a downpayment then be on the full term of the loan.  And if (when) they hose you, it’s a lot easier to recover from a $1000 bucks lost vs a $25000 loan.

Tune into The Sales Life Jr podcast and YouTube Channel. Advice I wish I would’ve gotten growing up, but didn’t. “Messages for junior adults, making senior decisions for senior results.”  

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