Co-signing catastrophe

Question: Fawn's mom co-sign for a commercial property loan for $85,000. The friend is not in good health and she's worried that she'll be left holding the bag. Can she buy an insurance policy to cover herself?

Dave Ramsey's advice: What in the WORLD was she thinking by co-signing for a loan with someone in poor health? If you can buy an insurance policy, I'd get one, but I'm not going to pay $10,000 for it. If he has something in his estate, like a lot somewhere, I would try to get that. If he has any assets, he should serve them up to her on a silver platter so she can take a lien against them. He should at least pledge something against this note and let her take a lien against the other stuff. If she can get his permission, she could also put a lien on his house. But NEVER co-sign a loan with someone. The reason the bank wants a co-signer is because they know the original signer is not going to pay.

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