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Your kids, your spouse, a parent, or even a good friend with bad or no credit might ask you to do them a huge favor and act as a co-signer for a loan or credit card. You might even be tempted to help someone out because you love them so much. Perhaps your kids want to go to college, but they can’t afford the cost of books and tuition on top of room and board. You want them to go far in life, so you sign your name onto their student loans. It seems like a wise investment, and it doesn’t make much of a difference in your financial life since they’re in charge of the repayment.

The problem with co-signing a loan or credit card for anyone is the financial burden it brings to you. One reason is now you have more credit utilization. Your score is affected, and you don’t even have the benefit of using the card or loan to assist in your own financial life. The biggest effect of acting as a co-signer, however, come when the person you signed for loses their job, passes away, or decides they no longer want to pay their bills. Now you are responsible for the repayment of their credit card, car loan, student loans, mortgage, personal loans, or any other monetary transaction you signed for. If you cannot repay those loans, your credit is destroyed. Co-signing is a poor financial decision, but it’s not too late to get out of it if you’ve already made the mistake of co-signing.

Apply for a Loan Release

This is typically available for student loans and sometimes available for other loans. When the original borrower is making their payments on time, has a good credit history, and proves creditworthy, the original creditor might consider releasing the cosigner from the loan. This is only possible if the signer and cosigner contact the lender to make the request. The best way to do this is to call the lender you’re working with and ask for a release. They will inform you whether or not it’s possible, and they’ll help walk you through the process if it is.

Discuss a Balance Transfer

Now that you’ve decided you’re not longer willing to be someone’s co-signer, talk to them about opening a credit card with a 0% APR on balance transfers. If their credit is now good enough to become approved for a card like this, they can transfer balances with the card or even pay off a loan using the card. Once the old card or loan is paid off, the account can be closed and you are no longer a co-signer for someone who might eventually put your own finances at risk.

Sell It

If you made the decision to co-sign a loan for a tangible asset and the borrower isn’t able to repay the loan, it’s time to sell the asset. It’s going to be a process, since you do have to work with the borrower to make it happen, but it’s helpful. Together, you and the borrower can sell a car or house so you can repay the loan and release you from liability.

When you make the decision to co-sign a loan for someone you love, you put your financial future at risk. Even closing out the account or loan can leave you in a bad place financially if the original borrower fails to close out the account. Your job once an asset is sold, a loan is closed, or a credit card balance is transferred is to discuss the closure of the account with the original borrower.

If you’ve yet to co-sign a loan or credit card account for a friend or family member, reconsider. The risk to you is far too great, and someone who loves and respects you understands when you tell them that you’re not comfortable putting your own financial future at risk. If they fail to understand that, the sad fact is they are not someone who respects you at all and their negativity is unwarranted and unnecessary in your life.