Think
before you borrow?
Better
Business Bureau (BBB)
Points to read before you commit to a loan.
- You
are being asked to guarantee a debt. If the borrower doesn't pay
the debt, you will have to. Be sure you can aford to pay if you
have to, and that you want to accept the responsibility.
- You
may have to pay up to the full amount of the debt if the borrower
does not pay. You may also have to pay late fees or collection
costs.
- The
creditor can collect this debt from you without first trying to
collect from the borrower. The creditor can use the same collection
methods against you that can be used against the borrower, such
as suing you, taking your wages, etc. If this debt is ever in
default, that fact may become a part of your credit record.
- Be
sure you can afford to pay the loan. If you are asked to pay and
you cannot, you could be sued or your credit rating could be damaged.
- Before
you take on a loan, consider that even if you are not asked to
repay the debt, your liability for this loan may keep you from
getting other credit you may want or need.
- Before
you use your property, such as your car or home, to secure the
loan, make sure you understand the consequences.
- Ask
the lender to agree, in writing, to notify you if the borrower
misses a payment. This will give you have time to deal with the
problem or make back payments.
- Obtain
copies of important papers, such as the loan contract and any
warranties if you are commit for a purchase. The lender is not
required to give you these papers; you may have to get copies
from the borrower.
©
2003 Council of Better Business Bureaus
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OCIS
provide general financial information, we urge you to consult an
Independent
Financial Adviser ( IFA )
before making any important decisions about your finances. |
