Many consumers may get rejected from signing up for a credit card because they carry bad or no credit. Oftentimes, a person will have a friend or relative cosign on the credit card in order to get approval. If you find yourself in this position you may want to think twice, as cosigning on a credit card can hurt your own finances.
The federal Credit CARD Act prohibits anyone under 21 from getting a credit card unless someone over 21 cosigns. However, if you decide to cosign for someone it could put your credit report and score at risk.
"When you cosign you are taking on legal liability for that debt, so if the person you cosign for can't or doesn't pay, guess what? You're going to be the one getting the calls from the debt collectors," Gerri Detweiler, author and financial blogger, told Los Angeles, California news provider KABC-TV.
If the individual you vouch for for is irresponsible with the plastic, your credit report could end up riddled with negative items. Be sure to review your report to see if all the negative items are accurate.
However, you have the right to investigate and dispute any questionable damaging claims that are marked on your report. Visiting a credit repair company and speaking with a credit repair attorney can help you challenge questionable claims and potentially erase these blemishes from your record.