by Randy Alcorn
Cosigning is assuming responsibility for the debts of another in order to assure a creditor that the borrower won't default on payment. If the person for whom I sign doesn't come through, I'm legally assuming his entire liability.
Scripture is very clear on this-we are told not to do it (Prov. 11:15). "Do not be a man who strikes hands in pledge or puts up security for debts; if you lack the means to pay, your very bed will be snatched from under you" (Prov. 22:26-27). In fact, we're told if we have already put up security for our neighbor, we should go and humble ourselves and plead and allow ourselves no sleep until, like a gazelle, we are freed from the snare we have put ourselves in (Prov. 6:1-5). To assume responsibility for the debt of another is to demonstrate poor judgment (Prov. 17:18). If you doubt this teaching of Scripture, consider that no less than 50 percent of all cosigners end up paying back part or all of the other person's debt! 1
When I sign for someone else, I am saying, "I will answer for all of this person's financial decisions, wise or unwise. I'm now legally and financially accountable for whatever he chooses to do."
If your desire is to help someone, give him or loan him the money outright, or offer him sound advice. More often than not, he shouldn't be going into debt in the first place. The best favor you can do when he asks you to sign for him is to just say no.
Footnote:
1. Howard Dayton, Your Money: Frustration or Freedom? (Wheaton, IL: Tyndale House, 1979), 50.
by Randy Alcorn, Eternal Perspective Ministries, 2229 E. Burnside #23, Gresham, OR 97030, 503-663-6481, www.epm.org
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