Home Business Should you ever co-sign a loan?

Should you ever co-sign a loan?



RICHMOND, VA (WWBT) – Not everyone is eligible for a loan. Sometimes you need a little help from the signatory. But should you do it? Be the one who signs their name on someone else’s loan?

There are two ways to look at co-signing. Because it can be both a very positive and a very negative experience.

Cherry Dale, a finance coach at the Virginia Credit Union, says you want to see what you sign up for and the overall risk. “If you sign up with another person. Basically, you sign up to make sure you are responsible for paying this bill, ”Dale said.

If another person is the primary debtor for this loan, you are still responsible for paying the debt. Especially if they don’t pay by default.

Dale says you need to really trust the person you are helping.

The loan can affect your ability to borrow at the end of the day. Even if you just sign a joint $ 5K credit card subscription for your child … it will be against you if you are going to buy a home.

Things to consider. Dale says communication is the key to success. Setting the rules for who pays … and knowing when to be billed. “One of the things you can do is just make sure you create an account where you both can view it. most financial institutions will do it online with you, ”Dale said.

If you sign a contract with your child, you may be able to get him to pay you every month. This way you can take care of the actual invoice and know that it is paid on time.

Copyright 2021 WWBT. All rights reserved.

Send it to number 12 here.

Want to get the top NBC12 news in your inbox every morning? Subscribe here.


Source link