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Can a Cosigner Have Their Name Taken off Debt?
All too often friends and family go the extra mile to help someone out financially, but what happens when you are the cosigners and you’re stuck with the bill? When a person has a cosigner usually they are just starting off and have no credit or their credit is not good. If you are the cosigner this can leave you asking the questions what next or what should I do? It is time to go over what exactly you can do and the options that you have.
What is a Cosigner?
Have you been asked to help a friend get the loan that they need? Well if you sign the papers as a cosigner then what you are doing is saying that if they default on the loan that you will cover them. For some this is the only way that they can get the funding that they need, but if they do not live up to their end of the loan then the co-signer can get stuck making the payments. This can cause a great deal of frustration because it could mean an extra bill that you do not have the funds to pay. Should you decide that as the cosigner you do not wish to pay, not only can it cause some legal problems, but it can in fact harm your credit. A term that can also be associated with a cosigner on a loan is a co borrower. It is important to know the obligations of a cosigner because it can be very frustrating if you are helping someone out and then you are stuck with the loan if they default or no longer are able to pay.
Taking a Cosigner off the Debt
As a cosigner you are responsible for part of the debt and it can be very difficult to get out of this situation. There are a few things that you can do, but it can take time and the primary borrower needs to be in good standing. One way to get your name off of the note as a cosigner is to have the primary borrower refinance the loan. If they are offered this option the then the lender may be willing to give them better financing and remove the need of a cosigner. In order for this to work though the primary borrower must have an improved credit score just to be offered the option to refinance. Since you agreed to be a cosigner it is very important that you know what comes with the obligation. If you are unaware of the circumstances then it can hurt you more then the primary borrower.
How Serious Is It?
Being a cosigner is a major responsibility and sometimes it can ruin relationships. There is a great deal of importance to the cosigner due to the fact that if the borrower can not fulfill their financial obligations to the lender then the cosigner is responsible for the funds otherwise they too will suffer. Should you decide to be a cosigner for a person you need to be prepared to suffer a financial burden should they not fulfill their agreement to the lende. The best case scenario for you as a cosigner is to protect yourself and make sure the borrower, who ever it may be, stays on top of their payments and does not leave you holding the bill.
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