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What is Cosigned Car Loan?

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People apply to co-signers to get approval for a loan if they have bad credit or weak creditworthiness. Not every co-signer understands how it will affect his credit history. If you are cosigned on a car loan, this debt will appear on your credit report as if it is your own car debt. If your friend makes a late payment, this information will also appear on your report and affect the credit negatively.

In a simple word, if you are a co-signer, you get an auto loan in your credit report but you can’t control it. You don’t control the payments on your own and if your friend misses it and your credit drops, you might not even know about it. Even if you know your friend as a trustworthy borrower, it doesn’t mean that he will manage to pay off the debt without late and missed payments.

Unfortunately, in most cases, people apply for co-signers when they have a bad credit and a lender doesn’t agree to approve a loan. Therefore, becoming a co-signer is quite dangerous.

“I cosigned for a car loan how to get out of it?” is a frequent request. The best idea would be to refuse to become a co-signer politely. If you can’t refuse, you should control payments independently because YOU are liable for YOUR credit.

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