If you cosign for a friend's credit card, what is the danger to you if your friend fails to pay?

Question

Deja Pruitt

Business

28 March, 23:37

If you cosign for a friend's credit card, what is the danger to you if your friend fails to pay?

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Valerie Love · Answer 1

As a co-signer, you are also liable for your friends debts. 1. You would owe the bank money. 2. It could affect your credit score.

Hypothetically, let's say your friend takes out a credit card for a max of $1,000.

They go and spend all their creditcard money on clothing within a week. They now owe $1,000 to the credit card company. Let's assume they fail to pay it. The credit card company can collect money from both you and your friend. You would be responsible for paying back the debt if your friend can't. If neither of you can afford to pay back the debt, your credit history can be affected for many many years.