You’re Asked to Co-Sign? Review These Important Facts First

by Isaac Benmergui, Esq on December 3, 2013

Hold your horses before you sign on that dotted line to help your high-strung son or daughter find his or her first place. There are some things you need to consider before being a co-signer, as it’s not what many think. For starters — you’re not simply co-signing a lease or rental agreement, but rather actually signing it as the tenant of the dwelling. No ifs, ands or buts. You will be the main person, fully liable for whatever happens in that dwelling.

Let me explain. Here are are some legal considerations for you:

  • Credit Scores Are Crucial — Understand that if, by chance, your son or daughter or whoever Contractyou’re co-signing for can’t pay rent for any particular month, that responsibility falls on you. You have to pay rent. And if you don’t, it drastically affects your credit score as you go into default. Not something you want to get into.
  • Damage Liability — Because you’re held liable as the co-signer, you’re also responsible for any damages, whatever they may be, even if you never inflicted the damage. Even if your son or daughter never did! It could very well be a roommate or someone visiting from the college, but whatever the case, you have to pay for it.
  • What Are “Subleases”? — We’re getting very complex here, but even when your son or daughter (or whoever) actually rents out the house or apartment, you’re still responsible for even the sublessee living in the establishment. If that person fails to make payments, you better pony up the dough.
  • Pay Close Attention to Roommates — We already mentioned that, but we stress it again, because it does matter. For instance: if it’s just your son or daughter (or whoever), it may be a safe bet to co-sign. But if your renter plans on shacking up with five or six football players, expect to pay for a lot of damages, possibly.
  • You’re Now Legally Liable — Finances is one thing; being legally responsible is another. A landlord can legitimately go after you as the co-signer just in case your son or daughter (or whoever!) does something, for lack of a better term, illegal.

Consider these facts carefully. And, of course, consult with your very best real estate attorney about your options. You’re never compelled or expected to co-sign, even if your son or daughter (or whoever) gives you the puppy-dog eyes. Make the right decision for yourself, because in the end, it’s your bottom line facing the front lines in this battlefield of real estate law.

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