Here's a sentence that uses both words correctly: 'The cold weather affected the crops the effect of the cold weather was a lower yield.' Remembering the difference between affect and effect is especially confusing because both words have very similar pronunciations, in addition to having very similar meanings. Read the terms of the loan and consider carefully whether you wish to take the risk of co-signing.Are you unsure about whether to use affect or effect ? Do you find yourself simply guessing which of these words to use in a given sentence? You're not alone. Lenders ask for a co-signer when they do not want to take on the full risk of loaning money to that particular borrower. If this debt is ever in default, that fact may become a part of your credit record.Ĭo-signing a loan may also affect your ability to obtain loans for yourself because you have taken on the obligation to pay the loan.

The creditor can use the same collection methods against you that can be used against the borrower, such as suing you, garnishing your wages, etc. The creditor can collect this debt from you without first trying to collect from the borrower.You may also have to pay late fees or collection costs, which increase this amount. You may have to pay up to the full amount of the debt if the borrower does not pay.

Be sure you can afford to pay if you have to, and that you want to accept this responsibility. If the borrower doesn’t pay the debt, you will have to.

You are being asked to guarantee this debt.

The notice will contain the following information: So make sure you can afford to pay this debt if the borrower cannot.Īs co-signer, you should receive a separate notice by the lender prior to signing the agreement. Your credit score(s) may be impacted by any late payments or defaults.Ĭo-signing an auto loan does not mean you have any right to the vehicle, it just means that you have agreed to become obligated to repay the amount of the loan. If the borrower defaults on the loan, the creditor can use the same collection methods against you that can be used against the borrower such as demanding that you repay the entire loan yourself, suing you, and garnishing your wages or bank accounts after a judgment. It means that you risk having to repay any missed payments immediately.

Something affects me