What happens if I co-sign a loan for family?
Co-signing a large loan severely restricts your future financial choices, including your ability to get student loans for school. While relatives may promise to just take your name off the debt in a year, the massive commitment leaves you burdened by guilt and conflicting feelings.
What people tried
Every workaround mentioned in the threads below. We haven’t tested any of them — and nobody here is claiming they worked.
Found another way around this?
Share your steps and trade-offs so fellow engineers don't have to reinvent the wheel. No account required.
- 1Refuse the request completely, recognizing that the bank has already determined the person is too high of a credit risk.Did this help you?
- 2Understand that a co-signer cannot just be removed; the original borrower must completely refinance the loan to take your name off.Did this help you?
- 3Only co-sign if you are fully willing and financially able to take 100% responsibility for paying off the debt yourself.Did this help you?
- 4saying no directlyDid this help you?
- 5making sure to get put on the house title and receiving mortgage statements if proceedingDid this help you?
- 6inventing an excuse or faking other debts to intentionally fail the bank's qualification checksDid this help you?
In their words
Unedited, grouped by where they were said, most upvoted first within each place, each linked to the thread it came from.
“My parents want to purchase an almost 800k home in Sacramento. And now is asking me to co-sign on the loan.”source ↗
“However I think this would severely restrict me in the future.”source ↗
“I am a bit scared to burden myself with such a large commitment but I do want to make my parents dream come true.”source ↗
“I almost feel like I owe them this which has very conflicting feelings for me.”source ↗
“I am asking for advice on a situation in which I am being asked to be a coborrower”source ↗
“They say it won't affect me getting student loans and that they can just take my name off of the loan in a year, but is that true?”source ↗
“Can I still get student loans I need to finish school if I co-borrow? Can they really take me off the loan in a year and it will be like it never happened?”source ↗
Where this came up
People with this problem also raised
- 3Can someone co-sign a HELOC if they aren't on the title?
- 4Can you negotiate a contract after signing it?
- 2How to handle a loan taken out in your name without permission
- 2Business loans without a personal guarantee
- 3How to ask parents for money when they already support me
- 2Do I need a details card if I have a wedding website?