Do you have a question about consumer credit? You may find an immediate answer by using the search engine. If you can't find what you're looking for, please fill out the form, being as specific as possible.
Please note: The Ask Experian team cannot respond to each question individually. However, if your question is of interest to a wide audience of consumers, the Experian team will include it in a future column.
The information contained in this column if for educational purposes only and is not legal advice. You should consult your own attorney or seek specific advice from a legal professional regarding your particular situation.
Please understand that Experian policies change over time. Column responses reflect Experian policy at the time of writing. While maintained for your information, archived responses may not reflect current Experian policy.
Topics addressed on October 13, 2010:
Deciding whether to cosign a car loan for your son or daughter
My son has less than perfect credit but was told by his bank he could get a car loan with a co-signer. I have extremely high scores and do not want them lowered for any reason under my control. Assuming all of his loan payments are made on time and the loan always remains current, will this negatively affect my credit scores?
As a cosigner, you accept full responsibility for the debt. That means the account and its payment history will be part of your credit report.
As long as the payments are made on time for at least the minimum due, your credit scores should not be affected negatively. However, if payments are late or missed, they will appear on your credit report, and your credit scores would be affected.
I’ve had others inquire as to whether the person’s past negative credit history could become associated with their report if they cosign a loan. The answer to that question is no. The other credit history is not associated with you in any way. Only the cosigned account would appear on both credit reports.
Cosigning is a decision that should not be taken lightly. Your concerns are very valid. It’s difficult to say no to a relative, particularly a child. By cosigning, you could help them begin to reestablish a strong credit history, but by doing so you can put your credit history at risk.
Thanks for asking.
- The "Ask Experian" team