In 2016, she was close to repaying the debt, but she defaulted and the car was repossessed.
As a result, my credit score dropped by almost 100 points.
-B.
Dear B.,
You tried to be a good friend.
But you did become 100% liable for the payments in the event that she didnt make them.
Time is the only thing that will heal it.
So yes, youll have to wait out the next three years to restore that once-pristine credit report.
Probably not as good as youd like.
It always seems like an uphill battle to build (and keep) a decent amount in savings.
But what if your car breaks down, or you have a sudden medical bill?
Ask one of these companies to help…
But that doesnt mean you cant keep improving your credit score between now and then.
Derogatory information does the most damage in the first two years after it appears on your report.
Its impact lessens after that.
Evenafter bankruptcy, many peoples credit scores start to recover within about two years.
The impact of this loan has already started fading away.
Did you know?
And your credit profile doesnt have to be perfect to do any of these things.
Youve obviously learned the hard way about the dangers of co-signing, so I dont want to lecture you.
Sure, this could backfire.
Another option is to ask the lender to notify you if a payment is late.
But you also need to have a serious conversation with the person you co-sign for.
They need to know about the consequences youll suffer if they dont make payments.
Open communication is essential.
And if anyone whos reading this is benefitting from a co-signers generosity, take note of all of this.
That person cared enough about you to put their finances at risk.
Show them youre worth the gamble by treating that debt as your No.
Robin Hartill is a certified financial planner and a senior editor at The Penny Hoarder.
Send your tricky money questions to[email protected].
No Interest Til Almost 2027?
Balance Transfer = Credit Card Cheat Code
