Should I cosign for my nephew's student loan?

Seeking Advice
1

My financially irresponsible brother asked if I could cosign on my nephew’s student loan. I didn’t get to ask how much it was for yet, but I’m assuming it’s under $10k. He and his wife have bad credit and were denied as cosigners because they have something in collections. I would have told them they’d probably be denied if they have stuff going to collections.

We have a good relationship overall, but I instantly got worried. I make around $40k a year and live a modest life. I am barely getting by as it is, and the US economy doesn’t seem to be forgiving at the moment. Gas alone is killing me. I work a full-time job and a side hustle just to manage my own debt (I had to dip into my emergency fund after some car and dental work). A $7-10k loan is a pretty big ask.

I’m not totally convinced of my nephew’s financial maturity or his academic performance. I love my family, and I know my brother must be desperate to ask, but my gut instinct is to tell him no. Any advice would be appreciated. :smiling_face_with_tear:

2

Becoming a cosigner on a student loan can help someone afford higher education by securing a lower interest rate, which can lead to significant savings.

3

Please don’t sign. Your nephew may elect to attend a community college and use his part-time job to cover the remaining costs. Don’t jeopardize your future so he can attend college.

4

NOOOOOOOOOOOOOOOOO, you are responsible if your nephew declines to pay. Never sign with another person.

5

Yes. The fact that he might not be able to attend college is just so tragic. I didn’t even discuss the finer points with my brother, but I still wanted to give it some serious thought and analyze the advantages and disadvantages. My first reaction is to say no. That’s a serious debt, and my credit is really good. It simply seems like too big of a gamble.