Read the fine print. Take a copy of anything you sign!

More than once I’ve heard from people who say that contracts they signed were changed after they signed them– with additions. When I ask them if they had a copy of the original, they say “no.” I have to tell them that this makes it almost impossible for them to have the contract, as shown, voided.

NEVER sign any contract of any kind without getting a copy (and saving it). That’s like sticking your chin out and saying “Hit me, right here, please!!!”

The other day I spoke to someone who not only did not get a copy of what she signed but did not read it first. She was cosigning for a family member to buy a car. She did not read what she co-signed.

Two years later she found out that:

1. What she signed was a actually not a simple car loan but a line of credit with a much higher balance than she thought she was cosigning for.

2. The family member who had that line of credit had bought another car and put it on the line of credit, driving it up to $20,000.

3. Then he defaulted and the lender came after the cosigner, telling her she was liable for the whole amount.

4. When she refused to pay the $20,000 all at once, they reported her to the credit reporting agencies as delinquent and she was unable to get a mortage. Then her credit card company reduced her line of credit from $20,000 to $2,000.

Cosigning can obligate you in the same way as borrowing. Do not do it unless you do not care if your credit gets dinged. (If you have no serious borrowing needs you may not care.)

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