Cosigner

The FTC puts it plainly: when you cosign, you agree to be responsible for someone else's debt. In many states the creditor can collect from the cosigner without first trying the main borrower. The creditor can also report the loan on the cosigner's credit report as their debt, so the borrower's late payments or default can show up there too.

Lenders must give cosigners a written notice that opens with "You are being asked to guarantee this debt. Think carefully before you do." On a credit report, the account's responsibility code shows the cosigner's role. Before signing, arrange a way to see the payment status yourself, such as online access to the account, because the first sign of trouble is often a late payment already sitting on your file.