- If the borrower passes away, you assume the same responsibilities for the deceased as if you applied for the loan yourself.
- If the borrower misses even a single payment on a loan, a lender may have the ability to demand full repayment of the entire outstanding balance on the loan immediately, from you.
- If the borrower defaults, additional penalties, including late fees, higher interest rates and other charges may be piled on top of the amount owed, and you are responsible for those penalties and fees.
- If the borrower defaults on the loan and it moves into the collection process, the lender may collect the debt from you. That means the lender may be able to take legal action against you.
- If the borrower makes late payments, your credit may be damaged.
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