Sunday, February 07, 2010
Co-signer for Credit Purposes Only

I reviewed a recent FCRA and credit damages lawsuit where one party was making a "I was a co-signer for credit only" arguement.  She contends that she only co-signed to help the other party to qualify for the loan and had no intention of actually being liable for the payments.  The story continues when the two have a falling out, the OTHER co-signer stops making payments and the collateral securing the loan was taken back by the bank.  And, of course, the credit reports of both parties were now showing the negative reposession.  For the record, there is no such thing as a co-signer for credit only.  Read your loan documents and they will clearly state that both parties are equally liable for payments and equally at risk if payments are not made.  Thankfully this case was settled and there was no potentially new legal definition for "co-signer for credit only."

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