Studies show that cosigners often face financial losses, so it's important to carefully consider before agreeing to sign a loan

Cosigning on a loan is a serious decision, and here’s another thing to keep in mind: 38 percent of cosigners end up covering the debt they agreed to.

We’ve already shared when it’s wise (and when it’s not) to cosign, but a recent survey from CreditCards.com discovered that 4 in 10 cosigners lose money. Over 2,000 cosigners were surveyed, and here's what they found:

Financial losses:

38 percent of cosigners had to pay part or all of the loan or credit card balance because the primary borrower failed to pay.

Credit score impact:

28 percent saw a drop in their credit score due to late or missed payments by the person they cosigned for.

Strained relationships:

26 percent of those surveyed reported that cosigning caused harm to their relationship with the individual they cosigned for.

Naturally, you should carefully reconsider before cosigning, but it's even more risky if you're already facing financial difficulties and the borrower has an unstable financial background. For more details from the survey, check out the link below.

Image courtesy of 2ranges.nl.