My son is 20 and would like to get a loan for the purchase of a used truck. He has already been told he needs a co-signer as he has never borrowed before from a bank or financial institution. What are the requirements to be able to co-sign a loan with him?
The lender is looking for a co-signer with a good credit rating, including the ability and willingness to cover your son's loan payments if he fails to do so. If you think you fit that description, you can sign paperwork with the lender to be considered as a co-signer. The lender will verify your creditworthiness by reviewing your credit history and the application. Assuming you meet the lender's criteria, you'll get a notice for co-signers that reminds you that you'll be "on the hook" for the payments if your son doesn't meet his responsibilities. The lender may or may not provide you a late notice if a payment is past due, so you should check on the loan regularly to know what's going on.
Your son's record on this loan will be reflected not only on his credit history but also on yours, so if you find out that a payment is past due, you should not wait for the bank to come looking for you to bring the loan up to date. By that time, you could already have some late payment history recorded against you.
If you believe your son is able and willing to handle this truck loan responsibly, and you if you have the resources and credit history to help him out as a co-signer, we'd encourage you to go ahead, but if you are unsure of your son's maturity and responsibility, co-signing could be a bad idea.
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The lender is looking for a co-signer with a good credit rating, including the ability and willingness to cover your son's loan payments if he fails to do so. If you think you fit that description, you can sign paperwork with the lender to be considered as a co-signer. The lender will verify your creditworthiness by reviewing your credit history and the application. Assuming you meet the lender's criteria, you'll get a notice for co-signers that reminds you that you'll be "on the hook" for the payments if your son doesn't meet his responsibilities. The lender may or may not provide you a late notice if a payment is past due, so you should check on the loan regularly to know what's going on.