Student Loan Consolidation Information
Removing yourself as a Student Loan Guarantee child?
My neighbor signed student loans as collateral for his son. The son has graduated (almost 1 year) and went away. There is now paying off his student loan on time and the lender, Sallie Mae, is now threatening to report negative payment information to credit file of parents in the offices. Is there any way to remove himself as an endorsement of the student loans of a child? Can the child to a consolidation of student loans and drop his father as guarantor?
C'mon, Really? The creditor made the loan because the son of his friend was able to offer your mom or dad as collateral. The fact that the lender requires an endorsement in the first place, it shows everything you need to know about the bank's confidence that the child actually the loan. And guess what, it turns out (surprise, surprise) they were right. The lender requires a guarantee because the guarantor would be on the hook in the case of son does not pay – and now that the child is not paying, you think there is any possibility that the lender is going to be an endorsement by the hook? You're missing the whole point of requiring a guarantee. Now that the child can not / do not / do not feel like paying, the lender will contact your neighbor to pick up. It will ask to "put in a good word with his son, will be asked to pay. If you do not pay, your neighbor is going to take to court, not the son, because (supposedly) your neighbor has assets, and son, no. And since neighbor voluntarily wrote his name on the contract, there is "not my debt" defense, because … is their debt. Legally. Every penny of it. This is exactly why What nobody cosign a loan – no matter the relationship between the borrower and the guarantor. Anything can happen – we all like to think "oh well, I I know my friend Bob is an honest man, and never have to worry about paying the loan for it "- that is fine. Until and Bob have a fight. Bob O to who loses his job. or until the injured Bob and unable to work or God forbid, Bob dies. Yes, That is correct. If Bob dies, the guarantee is 100% the obligation to pay the loan. The fact that Bob is dead makes no difference to the lender, except for the fact that now we know it will be the guarantee to repay the loan, not Bob. The same logic leads right into the next question – why would anyone consider consolidating a loan that is ready to fall into default because the borrower not make your payments as agreed? Sorry, but the news is all bad for your neighbor. I hate to say, but it is.
