Proverbs 17:18 “A man lacking in judgment strikes hands in pledge and puts up security for his neighbor.”   This scripture clearly warns us of the danger involved in providing collateral, security or surety for another person.  One very quick way of going into debt is by cosigning someone else’s loan.  People who cosign think […]

Let me explain what you are doing if you cosign a note.  You are loaning the money you borrowed to a person who was too great a risk for the professional lender.  You are involving yourself in a business transaction that the expert money manager would not touch.    If the professionals are afraid that […]

You are hoping that your friend or relative will pay back the loan.  There’s a good chance that it will not happen.  When your friend or relative defaults, then you have the “privilege” of paying back the money.  My advice is to never co-sign a note unless you can afford to give the money away! […]

You may argue that you need to cosign a loan for an offspring so that he / she can establish good credit.  While it does seem admirable for a parent to help their children get established, think about what your potential action is saying to them.    If you are cosigning so they can get […]

  You Become the Borrower   When you cosign a loan, know that you are now being asked to guarantee the full amount of the debt.  The lender has refused to make the loan to the person for whom you are cosigning.  The lender’s decision has been based on facts that reveal the risk is […]