I recently applied for a credit card with Wells Fargo but got denied, and I was confused because my credit score is 740. After looking into my credit activity, I found a $65,000 loan I co-signed for, which I didn’t even know about! It was opened three months ago, and it turns out it was my brother who did this.
I checked my credit reports from Experian, TransUnion, and Equifax to confirm everything, and I’ve filed disputes with all three bureaus since I wasn’t aware of this loan. I haven’t told my brother anything, and he doesn’t know I’m aware of the situation.
No, you should talk to your brother and ask him more questions. He will need to refinance the loan. You should also call the loan company to find out how your name got added and make sure it doesn’t stay on your record for future loans. Additionally, consider freezing your credit.
U should get the loan refinanced right away to remove your name from it. If your brother isn’t willing to do that, consider filing a police report to help get your name off the loan during the refinancing process. Just one missed payment could hurt your credit score.
I don’t understand why there aren’t regulations that require co-signers for loans over a certain amount (like $65,000) to meet in person or via Zoom for verification. If gyms require you to come in to cancel a $20/month membership, then why isn’t there more security around loan fraud for amounts like $10,000? I get that smaller credit amounts might be easier to waive, but it feels too relaxed for larger loans.
I see what you mean. Gyms lose money if someone cancels their $20/month membership, while debt collectors actually profit when people default on loans. That difference might explain why there isn’t the same level of verification for loans as there is for gym memberships. It feels like the system is set up more to benefit collectors than to protect borrowers.
If you co-sign for one loan, you might end up being a co-signer for every semester or year. $65,000 is a lot for one semester, which could mean $130,000 a year in loans. Just one late payment could hurt your credit. If your brother doesn’t finish his degree, what happens then? If he defaults, you’d be responsible for the entire debt plus interest unless you file a police report. It’s a serious risk to take on.
Either you accept being a cosigner, or your brother gets reported for identity theft and possibly goes to jail…There’s not really a third option for you.