 TITLE: Does Repossession Affect a Cosigner’s Credit? CONTENT: How Can Repossession Affect Your Credit as a Cosigner?\n------------------------------------------------------\nAs a cosigner, you use your good credit score and history to help the primary applicant, usually a relative or close friend, qualify for a loan. The lender approves the loan based on your qualifications, under the assumption that if the applicant doesn't make their payments, you will make good on the obligation. Even though you don't own or use the car, you and the primary borrower are equally responsible for making sure the loan gets paid.\nIf the person for whom you've cosigned falls behind on their payments and their car is repossessed, the repossession will hurt your credit just as it hurts theirs. The repossession will be listed on your credit report for seven years from the date of the first missed payment that led to the repossession. You could also be held liable for the deficiency balance, along with any repossession costs and fees.\nBut the hits to your credit start well before the car is repossessed. Your credit report will show a history of late payments on the loan, as well as the loan going into default. If you or the primary borrower do not pay the deficiency balance and the lender sends it to collections, the collections record will also appear in your file. Finally, any court judgments associated with the loan will go on the credit histories belonging to both loan signatories.\nEven if you have great credit otherwise and make all of your own payments on time, a repossession or default on a loan you cosigned could seriously hurt your credit score. END