In need of some advice.

Laker_Town · Retired Number Joined: 26 Jun 2006 Posts: 25604

I feel a bit silly posting this on a forum...but I cant recall the last time I felt this confused and emotionally bothered. I dont know what Im really looking for by posting here. Perhaps, its just an unbiased opinion/thought.

Heres my situation: (ill keep it brief)

2 days ago my aunt called asking for me to co-sign for a 5K loan. I never co-sign for anyone, but this case is different. Her husband has cancer and doesnt live in the states. She doesnt have the money for a plane ticket nor the money for the operation. Now, at first I concidered it because I know shes in a desperate state. Her husband is a very good person and Id like to help in what I can.

The dilemma:

My heart tells me to sign, but her reputation of paying back isnt as great. She owes money left and right. My wife is expecting next month and we had created a budget for her to stay at home for a while. Its very likely that my aunt will miss a payment and Ill be held responsible. BUT i cant take on another payment. I just got debt free because of my baby. I feel upset. I feel like it wasnt fair for her to put me in this situation. I have a big responsibility ahead of me. Im one year from graduating and work two jobs, plus the baby.....I dont know HOW Id manage.

I love my aunt..Shes like a 2nd mom, but I cant....I really cant. So last night, over the phone, she noticed my hesitation, and said "Its okay son, Ill look for someone else" Man, Ive never felt so damn low....I felt like a ton of bricks fell on me. I hate the guilty feeling that came over me.

To make things worst, last Saturday, she lent her house(she rents) to do a surprise baby shower for my wife. The guilty feeling only grows.....

But why would she ask me? Shes got a daughter, and two sons, and I dont know if she asked them to sign. I dont know there credit situation, but theyre HER kids! DAMN THIS FEELING!!!!!

Im sorry, I kow I said it would be brief, but I just have to vent...I dont know what Im looking for by posting this, but I just needed to let it out.

Panthas · Star Player Joined: 30 Dec 2005 Posts: 1262

Your first Reaction is usaully the best.
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Bergamotichek · Retired Number Joined: 02 Sep 2007 Posts: 16777206

Your immediate family (wife and unborn child) are your #1 priority in life. You've already come up with all the (right) reasons why you can't abide her request.

While it feels crappy and like you're letting her down... how much more damaging would it be to the relationship, if you did end up having to take over the loan? How much more guilt would be associated with it, if you were unable to provide for your own family, because of it?

Lakers_2000 · Posted: Thu Aug 24, 2006 9:19 am Post subject:

Focus on the important information to this decision, and ignore the rest.

"her reputation of paying back isnt as great. She owes money left and right. My wife is expecting next month and we had created a budget for her to stay at home for a while. Its very likely that my aunt will miss a payment and Ill be held responsible."

That's what you need to know. There's a reason she can't get a loan from any reputable lender - her likelihood of paying it back is incredibly low. If you co-sign this loan, it'll become a "gift" in no time.

This would also have the potential to hurt your credit score. If she is responsible for making the payments, and doesn't, it will show up on your credit score as a missed payment. Eventually you'll not only be responsible for the $5000, you'll also have trashed your credit score in the process.

If you did choose to co-sign, you could always structure the arrangement where make the payments to make sure they get made on time, with her being responsible for paying you beforehand. But if she doesn't make the payments to you, you're still out of luck. It would just be a quicker way of making this loan a gift.

Laker_Town · Retired Number Joined: 26 Jun 2006 Posts: 25604

thank you guys

ocho · Retired Number Joined: 24 May 2005 Posts: 53791

Like JD said, your immediate family comes first.

F Snaq · Posted: Thu Aug 24, 2006 9:48 am Post subject:

She probably understands your situation. You're working hard and going to school with a baby on the way. You should not feel too bad, for many would feel the same way as you.
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uberzev · Posted: Thu Aug 24, 2006 9:52 am Post subject:

Panthas · Star Player Joined: 30 Dec 2005 Posts: 1262

Thats what Niche said...

But I guess your right!!!
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Alpha · Posted: Thu Aug 24, 2006 5:34 pm Post subject:

prisma8slg · Posted: Thu Aug 24, 2006 5:40 pm Post subject:

General rule of thumb is never loan someone money that you can't actually give to them. because if they don't pay you back, you should be able to handle that financially.

with the birth of your child coming up (congrats by the way

), that's what you need to focus on.

Of course you feel bad for your Aunt, you said she's like a second mom to you. But you really have to put your immediate family first. If you still want to do something for her, you might want to consider loaning her the money for a plane ticket. It's less than the 5K she wants and I'm not completely sure of your budget situation, but if she doesn't pay you back the money for the plane ticket I'm doubting it'll break you financially.
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Heartburn · Posted: Thu Aug 24, 2006 5:43 pm Post subject:

The people above are right. Take care of home first.

I don't know your financial situation or your aunt's financial situation but in the grand scheme of things $5000 is not a lot of money. Seriously, I am not trying to sound flippant about money. Of course, one person's $5000 is another person's $500,000. Even still, it's not an enormous amount and something tells me that that this will blow over soon. People find ways of making things work.

That said, you could fashion a compromise. Lend her $2500 (if you have it). This way you can salve your conscience a little bit and he gets some of the help she needs.

Knowing she won't be able to pay you back for some time, you can cushion the financial blow in the most convenient way you can without having to worry about notices from creditors.