topic Re: Co signed loan in Credit score

Co signed loan

Kboo — Tue, 25 Aug 2020 16:32:19 GMT

I hope signed a car loan for my daughter and she hasn't been able to make regular payments and neither can I. Now my credit score has gone down. How do I fix this?

Re: Co signed loan

macuser_22 — Tue, 25 Aug 2020 18:27:23 GMT

By making, and keeping up, the payments. Since you accepted responsibility to pay the loan if she did not and failed to do so, you are an obvious credit risk so your score SHOULD go down. The only way to raise your score is to prove (over time) that you are credit worthy and a good credit risk.

Re: Co signed loan

cgervasi — Mon, 02 Nov 2020 16:50:29 GMT

I agree with @macuser_22. If you bring the account current, including all penalties, your credit score will improve and eventually bounce back to where it was. Before doin it, you might ask the lender if they could waive some of the penalties and late charges if you bring it all current at once.

My way of looking at co-signing is that banks are experts in figuring out who's at risk of not paying. They require those people to have a co-signer who is lower risk. They're pretty good at their job, and they rightly predicted your daughter couldn't pay and you could.

Maybe you could help her shine the car up and sell it and buy her a cheap car. The deal with her would be she's absolved 100% of any responsibility or hard feelings with you if she just helps clean it up and get it sold. It would be tragic if this one financial snafu created long-term hard feelings.

Re: Co signed loan

skypilot1992 — Mon, 08 Mar 2021 06:05:45 GMT

Another suggestion:

Payoff the loan and ask the lending institution to amend its filing. No guarantees.

The basic rule of thumb: never cosign. But if one does ensure that notifications on loan status will include the cosigner.

It takes years for a failure or late pmt to drop off ones records.