You made the right call. By co-signing as a guarantor, you’re agreeing to make the payments if your grandchild stops paying back the loan. We’re sure she has every intention of paying back the loan, but things happen. And if you don’t have the funds – or desire – to help her out, you shouldn’t sign on as a guarantor, says Joseph Orsolini, a CFP with College Aid Planners. Don’t put your retirement at risk to send her to a college that seems beyond her means. Ask your granddaughter if she’s filled out the FAFSA to see if she qualifies for the federal student loans that don’t require a guarantor.
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Zanzibar Social Security Fund
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Monday, June 23, 2014
Should I have co-signed my grandchild’s student loan as a guarantor?
Agnes emailed: I was asked by my grandchild to sign her student loan as a guarantor but I refused because I don’t have much savings to pay off her loans in case she fails to pay back. Was it a right decision? What are the disadvantages signing as guarantor?
You made the right call. By co-signing as a guarantor, you’re agreeing to make the payments if your grandchild stops paying back the loan. We’re sure she has every intention of paying back the loan, but things happen. And if you don’t have the funds – or desire – to help her out, you shouldn’t sign on as a guarantor, says Joseph Orsolini, a CFP with College Aid Planners. Don’t put your retirement at risk to send her to a college that seems beyond her means. Ask your granddaughter if she’s filled out the FAFSA to see if she qualifies for the federal student loans that don’t require a guarantor.
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