credit cards

5 warnings for a credit card co-signer

You need an exit strategy
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You need an exit strategy

Do you want to be responsible for your friend or relative's credit card bill for life?

If not, you need an exit strategy.

Often, ending the co-signing arrangement requires closing the card account, says Nessa Feddis, vice president and senior counsel for the American Bankers Association.

The wrinkle: Depending on the contract and your state laws, you may need the cardholder's cooperation, she says. It may not be as simple as just telling the card issuer you want out.

Another consideration: Unpaid debts accumulated while the co-signed account was open are still your responsibility -- even after the account is closed. Until they're paid, they're still your bills, too.

Considering co-signing? Call the issuer first, and find out exactly what your options are for ending the co-signing relationship when that day eventually comes, Feddis says. Do you have to close the account? Do you need the account holder's permission?

While you're at it, ask about your access to account information. Can you get account status and balance information as a co-signer? Will you be told if the credit line or interest rates change? Will you be notified if payments are late or if the account is heading for default?


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