Have you ever been asked by a relative to co-sign on a debt in order to help them get the car or apartment they want? Well, you’ve probably put a big target on your back, says the Bankruptcy Law Network.
In most cases, if the borrower files Bankruptcy, sooner or later, the creditor is going to take collection action against the co-signer. The reason is simple: the borrower needed your good credit to get the loan in the first place, so, obviously, the lender is going to look to you if the deal goes bad.
As the article above notes, a bankruptcy filing by the borrower only provides limited protection, if any at all.
The moral of the story? Don’t co-sign on debt, unless you’re willing to pay it all back in the end.
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