Cosigning Loans and Its Hidden Downsides
Cosigning Loans and Its Hidden Downsides
This might be a very helpful move for the latter, but it could be potentially harmful to you. Below is a discussion on the negatives of cosigning a loan.
The Other Person Will Be Happy, But You May End Up Losing A Lot
Your help might be very welcome to the other person, but there is at least some chance they may be unable to repay completely or on time. In case they already have a case of bad credit, they may not worry about yet another strike and may go ahead making delays in payment. People have had experiences where the person cosigned ended up with total responsibility for the loan.
Cosigning A Loan Could Be Bad For Friendships And Families
It is natural that you will try to get the other party to make timely payments. However, this might be mistaken as a lack of trust. If they miss any of the payments, it could lead to further impacts. For instance, their non-payment may lead to loss of your credit. Such a situation is enough to destroy friendship or family relationships.
