Co-signing loans - Page 2 - Mothering Forums

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Old 09-24-2010, 09:52 AM - Thread Starter
 
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We didn't get to talk to my sister last night. We'll try tonight. So this is all still up in the air.

My mom doesn't think that they will listen to any alternatives. I spent about an hour last night and found that the city bus comes within 1/2 mile of where my nephew is working. He could EASILY take the bus then walk that last 1/2 mile. Millions of people use public transportation every day! But I don't know if they would even listen to that option. He could do the Bike and Ride with the bus and that last 1/2 mile would be nothing.

Re: mom being our dependent. What I talked about above was what our accountant told us when we decided to start claiming her on our taxes. I'll have to put a call into him and ask again.
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Old 09-24-2010, 10:12 AM
 
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I don't honestly think it is your job to figure out how to get your nephew to his job. That's his job, especially since you already bailed him out once.

I'd suggest working it out will enhance his image as a problem solver.

I have helped out a lot of family in the past but I've learned that sometimes helping just sets up bad patterns, and it seems like you're kind of in the role of 'family fixer.' It can be hard to step away from that but it might be healthy to let other people sort it out while you just say no, this time.

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Old 09-24-2010, 10:37 AM
 
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Originally Posted by odenata View Post
No, I would not co-sign.

Also, if I was in a position where I would be legally liable for someone's debt, I would probably want a power of attorney signed so I was in charge of their finances.
Yes, and then your mom can honestly say that it is not up to her, that you have power of attorney.

"It should be a rule in all prophylactic work that no harm should ever be unnecessarily inflicted on a healthy person (Sir Graham Wilson, The Hazards of Immunization, 1967)."
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Old 09-24-2010, 10:59 AM
 
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I don't honestly think it is your job to figure out how to get your nephew to his job. That's his job, especially since you already bailed him out once.
I agree. I have a 40 year old BIL with horrible credit, no steady job, no place to live, no car, no health insurance, and defaulted student loans. I really believe that if his parents had stopped enabling him years ago, he may not be in this position.
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Old 09-24-2010, 11:11 AM
 
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My mom doesn't think that they will listen to any alternatives.
Then don't bother even offering them. There's nothing either of you guys need to do, figure out, or convince anybody of. All you have to do is say No.

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Old 09-24-2010, 11:15 AM
 
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Then don't bother even offering them. There's nothing either of you guys need to do, figure out, or convince anybody of. All you have to do is say No.
^^I think this bears repeating.

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Old 09-24-2010, 11:15 AM
 
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Oh, and the threat to cut you guys out of their lives? Well, that's up to them. You're not making that choice, your sister is. Just goes to show you how unreasonable this all is. For real, you are seriously obligated to provide your nephew with a fine set of wheels? No WAY. You are not obligated to provide him with a CRAPPY set of wheels. You're not obligated to provide him with a BICYCLE. With a RIDE TO WORK. With a PHONE NUMBER TO THE BUS STATION. Nothing of the sort!!! This is all his responsibility!

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Old 09-24-2010, 12:15 PM
 
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I doubt that the bank would take her as a co-signee if her credit is bad.
Like everyone else, I agree but from what I hear from my banking and finance friends, it really isn't that hard to get a car loan right now, which is surprising to me.

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Yes, and then your mom can honestly say that it is not up to her, that you have power of attorney.
OP - Along the lines of power-of-attorney thinking - If your mom does start down the road of co-signing, could (or would) you go to the bank and tell them she was pressured into it?

Is this a local bank? Or a dealership?

I worked in banking and it was not an uncommon occurance for a spouse or family member to come to the bank and say "my son is pressuring my wife to co-sign, please don't do this loan with her name on it because we can't afford it or she isn't able to make the decision for herself, etc"

Now, I am sure this type of thing broke some sort of banking rule but it often worked.

I saw lots and lots of co-signed loans go bad. In fact, it was sort of a given and therefore, the bank was super-particular about the co-signer.

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Old 09-24-2010, 01:21 PM
 
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Velo, you always give such great advice in this forum that I think you should think about what you would tell someone who posted your exact post. I know it's different when it's your family, but this truly seems pretty open and shut. It's terrible that your sister and nephew are putting your mother (and you!) in this position, but if this is the road they want to go down (on a bicycle...) so, so be it.

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Old 09-24-2010, 03:10 PM
 
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It sounds like you're going to have to keep saying "No" and "That's your problem" over and over, until they get it.
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Old 09-24-2010, 03:51 PM
 
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If you worry about your mother caving to the pressure could you put in a call to the bank loan officer? I doubt they'd okay a loan with that kind of backstory.

Mother of two. : 4/05 and 1/07 Wife of one. : 7/01
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Old 09-24-2010, 04:38 PM
 
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Absolutely not, in this situation.

I think in general, co-signing should be something done rarely. My parents generously co-signed with us on a house, under the following conditions: they could afford to make the payments if we defaulted, we had a *huge* downpayment from savings, they knew that barring death and destruction we wouldn't default, and although I was a sahm and we had a very low income they had seen dh and I live frugally and knew that he'd work his rear off in order to pay the mortgage.
In other words, they cosigned not to "save" us from our stupid financial mistakes, but to give us a boost in the direction we were already going. We couldn't get the loan on our own because my age, and his newness to the country meant that neither of us had any credit history.

However, if I could go back for a do-over, I'd rather rent for a few years and do the house thing on our own. There were no financial problems, but there was relational tension because of the loan. Even though dh agreed to it, it still felt to him "intrusive", and I think my parents were totally well meaning but felt that the financial partnership gave them an opening into our personal lives that was uncomfortable for all of us.

If you co-sign to rescue someone who is currently in deep financial doo-doo because of poor choices, or who has a history of poor financial choices, that's pretty much saying "Problems, start knocking at my door!!"
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Old 09-24-2010, 05:10 PM
 
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Um, he had 3k bucks from the totalled car that was given to him and he blew it instead of finding transportation. It's not your job nor your mothers job to figure out how he can get to and from work. Personally I'd just say NO and leave it at that there is no reason you need to brainstorm other options. You don't owe him anything, he is an adult with living parents.
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Old 09-25-2010, 04:12 AM
 
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I would put my foot down with your mom. It enrages me when MIlL spends money on expensive gifts (even for us!), in the end, we are the ones who support her!

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Old 09-25-2010, 10:23 AM - Thread Starter
 
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My mom talked to my sister. She said simply, "I looked over my budget and if something were to happen and this came back on me, I just wouldn't be able to make the payments. I can't do it." My sister said, "Nothing will happen. I guarantee that I will make the payments if I need to." My said, "But something can happen to you or your job that's not in your control. You can't make those kinds of promises" Sis said, "Nothing is going to happen. Forget it. So much for family helping. Fine, son and I are on our own now." Mom said, "I just can't do it. You can't predict that nothing will happen and if it does, I would have to stop paying my supplemental insurance." (Of course, we would never let that slide as it is a HUGE savings with my mom's health problems, so we'd end up making the payments, which is why I'm saying that if anything happens it really *IS* on us, not my mother.) Sis said something like, "Nevermind, nevermind. I knew I couldn't count on you." and hung up on my mom.

Oh, and mom said something about helping him to buy a moped or something and she just said, "No way! Not with winter coming on." Yeah, right. She was OK with him getting a crotch rocket this same time last year (because he looked COOL on it) and didn't care that his only transportation would be a motorcycle.

If sis cuts us out of her lives because we are not a personal bank for them, then I say good riddance. I'm not going to lose sleep over this and I hope my mom won't either.

Thanks again for all of the support.
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Old 09-25-2010, 10:29 AM - Thread Starter
 
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Originally Posted by cappuccinosmom View Post
If you co-sign to rescue someone who is currently in deep financial doo-doo because of poor choices, or who has a history of poor financial choices, that's pretty much saying "Problems, start knocking at my door!!"
You know, this statement sums up this situation very nicely. That's exactly what it is.
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Old 09-25-2010, 01:41 PM
 
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Sis said something like, "Nevermind, nevermind. I knew I couldn't count on you." and hung up on my mom.
This is an opportunity for your sister to GROW UP.

~ Mum to Emily, March 12-16 2004, Noah, born Aug 2005, Liam, born January 2011, and wife to Carl since 1994. ~
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Old 09-25-2010, 01:53 PM
 
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I just wanted to say sorry that you are having to deal with this. I am also guilty of becoming the 'problem solver' within my extended family. It is a tough spot because they are your family and you care for them, but in the end they aren't going to change and will most certainly bring you down into the muck right along with them. And knowing that still doesn't make it easier
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Old 09-25-2010, 02:46 PM - Thread Starter
 
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This is an opportunity for your sister to GROW UP.
I know, but she is 50+ years old. I think that ship has sailed.
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Old 09-25-2010, 02:59 PM
 
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Good for your mom!
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Old 09-26-2010, 01:55 AM
 
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My mom doesn't think that they will listen to any alternatives.
Even if they won't listen, if you all continue refusing to co-sign, he'll have to figure something else out.

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Old 09-26-2010, 04:29 PM
 
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I know, but she is 50+ years old. I think that ship has sailed.
It is never too late to learn.

FWIW, I agree with what you and your mom are doing by refusing to co-sign in this case.

I am very grateful my grandfather took a chance with me and my then-husband when we were very young (18-19) and had a very short credit history (good, but only one store card for a year or two). He co-signed on our first car loan when no one else would. He really helped us out by doing that. We made all the payments on-time and honored his request of letting him know when it was paid off. Obviously very different circumstances. I just want to point out that sometimes co-signing can be a beneficial situation for all involved.

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