Truck Loans Australia :: Articles

Co-Signing Loans - Risky Business

Co-Signing Loans - Risky Business

The vast majority of individuals, seeking a co-signer fully intend to make timely payments. Unfortunately, good intentions are sometimes interrupted by unforeseen problems and situations.

Typically, when you co-sign a loan it makes it more difficult to get credit yourself.

This is because lenders take into consideration the cosigned loan, when figuring out your debt ratio. Depending on the size of the loan, it could very well put you over your limit.
If you are asked to co-sign a loan with an open line of credit, consider it very carefully before making any decision.

As the cosigner you will have no way of controlling the spending habits of the individual who will be making the purchases.

They could easily tell you they will only be spending $1000 when in reality they spend 10 times that much.

There are certain lenders who will agree to initially freezing a line of credit, if it is requested.

In this case scenario, there is less risk involved.In many cases cosigners are not notified until the loan actually defaults.

This obviously causes a problem, because it may be too late to rectify the situation.

It is wise to ask the lender if you will receive a duplicate statement or be given the ability to check payment status by phone.

If the answer is no, think twice before signing on the dotted line.

Unfortunately, individuals who require a cosigner either have no credit or bad credit.

Although those with no credit history are probably more apt to make timely payments, there is still no way to be sure.

Individuals with bad credit may be prone to the same habits that resulted in a bad credit rating, in the first place.

When it comes right down to it, cosigning a loan is risky business, no matter how close you are to the borrower.

Before you commit yourself it is important to ask yourself if you can pay when your "friend can't".


Finance Articles

How to Get Out of Debt
If you have found yourself in a position where you are in serious debt and cannot think of a way out of the situation, then take... read more

Credit Secrets - What They Are Not Telling You
Credit plays a dual role in our society; sometimes a lifesaver, and at other times a murderer. Trying to float above imminent... read more

What makes up a good mortgage?
Whether you are about to buy a home or you have an existing home loan, you want to be sure that you get the best possible mortgage... read more

Managing Credit Card Debt
If your credit card debt is starting to get out of control - or you simply want to know how to avoid potential credit card pitfalls,... read more

Mortgages, personal loans and credit cards - what the banks don't want you to know about debt.
Have you ever wondered why its so easy to get into debt, when you don't want to. And then wondered why its so hard to save a $1,000,... read more


Finance News

Personal Loans to help Australians in need: FSO
Oct 29 :: As Australia prepares to clean up following devastating fires and floods, Financial Services Online CEO, Andrew Clark, has announced... read more

Small business loans to help Aussie businesses through tough times
Nov 27 :: Financial Services Online has today announced a new credit facility for Australian business customers who are seeking loans for... read more

Police issue warning about bank scam
Nov 20 :: Melbourne police are warning people about a scam in which fraudsters pose as bankers and ask for money.They say they cold... read more

ANZ nets solid profit despite wealth management
Oct 26 :: ANZ banking group has reported a solid full-year result with net profit attributable to shareholders up 6 per cent to nearly $5.7... read more

Millions lack access to basic financial services
Jun 01 :: Nearly 3 million Australians do not have access to basic financial products such as a credit card, car insurance or even a bank... read more


Start Here

Get a free truck loan eligibility assessment and compare truck finance and leasing options without accessing your credit file!!
Loan Amount:
Postcode:
Important: All truck finance quotes are supplied to you free and without any obligation. We respect your privacy.

Knowledgebase
Mortgage Document:
The physical contract agreement that a Mortgagee (lender) enters into with a Mortgagor (borrower) outlining the precice terms of a mortgage loan.