Cosigning a Loan: The Credit Risk

A cosigner is responsible for the debt, and the account can affect their payment history, utilization or balances, and future borrowing.

You owe it too

Cosigning is not a character reference. If the primary borrower does not pay, the creditor can pursue the cosigner under the agreement.

It appears on the file

The account and payment history can appear on the cosigner credit report and count in later underwriting.

Ask for access

Before signing, request statements, online visibility, and payment alerts. A surprise late payment is still late.

Plan the exit

Refinancing or formal cosigner release may be possible, but approval is not guaranteed. Do not sign based on a promise that removal will be easy.