Loan cosign

Monday, Sep 10 in Co-sign, Loans | Comments (1)

Question: Patty learned that her mom co-signed for a car with her grandson, and he defaulted. Does she own the car that the loan was for? Dave has some bad news for her.

Dave Ramsey's advice: Call the little twit up and tell him to bring the car, because you're about to sell it. You don't own the car unless you put your name on the car as an owner. When you co-sign for a loan, you are playing Russian roulette with your financial life. If the person you sign with defaults, you'll blow your money brains out.

Debt is the most aggressively product in our entire freaking culture! If the bank wants you to co-sign, it's because they know that signer won't pay. So don't be shocked when this comes back to bite you. Co-signing is STUPID! I've co-signed with people and had them co-signed for me, and it doesn't work. The twit that you're signing with won't pay, and you will. Don't co-sign!!!

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Co-signing catastrophe

Thursday, Aug 23 in Loans | Comments (0)

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.