January 15,2007
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The Woes of the Co-Signer
Co-signing on a loan can be a really nice thing to do for someone, especially when it comes to an adult child trying to build credit. Many are the parents who, in the interest of boosting Junior's lending potential, have co-signed on an apartment lease or car loan to the tune of many sweet promises to stay solvent and pay the bills on time. "Nice," however, has sunk many credit scores!
If one half of the titled parties defaults on a loan, the burden of payment goes entirely to the co-signer. What seemed like a nice gesture can suddenly become a huge pain in the rear, if it means absorbing a new monthly payment of a few hundred dollars! It may seem cold-hearted, but the best thing that you can do is to just say "no." Building credit is a necessary evil for young adults, and it would be foolhardy to risk your financial future for a favor.