Why you shouldn't co-sign a loan for ANYONE

With years of mortage lending experience, I've seen it all. One situation that gets the best credit homeowner/buyer into trouble is a co-signed loan.

You start out with the best of intentions...helping out a family member or "trusted" friend who has some trouble securing their own loan. Sure all they ask you for is your signature, but what you are doing in fact is borrowing the money WITH them, and lending them YOUR credit report.

If they miss a payment, are late, or just stop pating for any reason....guess what? Your credit report gets hit with negative marks. Your credit score goes down like a sinking ship. And, you probably lose the warm fuzzy feeling for that family member or friend.

The worst part of all of this is it usually happens initailly without your knowledge. You get no warning, no notices in the mail, and usually the person you co-signed for is the last person to ask for help making their payments. You end up with a nasty little surprise on your credit report the next time you go to finance a house or car.

You may think it won't happen to you, but keep in mind...most people who need a co-signer need one because they have a bad credit history in the first place, or they have not proven themselves credit worthy.

So when someone asks you to be their co-signer.....just say no.