Cosigning on a debt is verbally committing or signing a contract that says you will pay the amount of money another person has borrowed if he does not meet the obligation to make the contractually required payments. Another form of cosigning is using your credit accounts (visa, mastercard, etc.) to make purchases that someone else has agreed to pay you for if you will make the purchases for them. Agreeing to cosign for another person’s borrowing will cause you to lose money almost every time.
Most people who could not pay cash for what they wanted or who did not have the good credit history necessary to borrow money on their own to make the purchase have not had the responsible nature necessary to show that they are a good credit risk. Financial institutions have extremely trustworthy systems to measure payment risk and if they will not loan the person the money without a cosigner then we should take heed and not enter into this situation.
Many of the people asking you to cosign will continue to be financially irresponsible and impatient in pursuing desires and in other financial dealings. In the end, this means that they will stop making agreed upon payments or fail to pay you back and then you will be required to make the payments at some point in time, risk ruining your credit history, and put you in a bad financial situation.
Cosigning encourages people (family, friends, etc.) to remain financially irresponsible and untrustworthy. Refusing to cosign doesn’t mean that along your path of life you should not help people. Feed a man you meet who is hungry, give clothes to a person that has none, and help find shelter for one that is homeless. However, there are many resources already in your cupboards, closets, and community that you can use for this purpose.
If the person cannot afford to purchase a material thing he desires (product or service he does not truly need), then he should not have it at this time. He should learn and if necessary you should teach him to work to meet his own desires on the income he receives and to trust God to provide the means to meet needs without causing anyone to take on debt. Use only what you have available above what is necessary to meet your needs and required bill payments, so that by example you show others that this is the path they should walk.
If you don’t already have the money in savings or investments to pay the full amount that would be borrowed, then you are not in a position to help the person to that degree. Even when you do have the money, you should still measure the situation to ensure that you are not casting your pearls to swine. You should not waste resources that God entrusts to you on people who willfully disregard God’s instructions on good stewardship. Regardless, of what you do for them they will continuously and irresponsibly spend and make bad financial decisions that continue keep them in the position where they cannot purchase the things they truly need and desire.
Watch, pray, and observe people to find out how you should help or instruct people who solicit the use of your credit accounts and signature on loan contracts that benefit them. The devil is constantly searching for a way to encourage you to mismanage money so it is of no great use in helping fulfill the Great Commission via prudently providing for your family, giving to maintain and enhance your local church outreach and discipleship ministry, and giving to fund missions work through other people who are in places you cannot physically reach. Through failure to study and understand the bible, many people don’t realize they’re being used by the devil in this way. So, don’t condemn them, just don’t give in to the enemy’s plan for the money God has entrusted to you.
The best way to help others and ensure that you are not an infidel (irresponsible and untrustworthy) who doesn’t appropriately provide for your family and take care of your responsibilities is to use available cash or resources when a true need exists. Immediately discontinue cosigning and pray that those who approach you to cosign will allow the Holy Spirit to guide them in using biblical money management principles, so they can meet their god-given responsibilities.
Please pray for this ministry and email any questions. May God bless you richly as you follow His plan!!!
Proverbs 11:15, 17:18, 20:16, Romans 13:8, Ephesians 5:15-16, 2 Thessalonians 3:12-15
Please forward these bondage breaking articles to other people who can use helpful insight!!!
You can find books authored by Randy and Karen Parlor at www.Amazon.com.
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