Becoming surety for a friend or relative…how safe is it?

Many people have entangled themselves in unnecessary financial burdens by way of being a surety to a friend or relative. Most often people stand as surety for friends and relatives out of emotional impulse without considering the consequences of their actions.

 In the long run, they find themselves stuck in the quagmire of debt by proxy.

 It will not be worthwhile going into debt, indirect debt for that matter in an attempt to maintain a relationship with a friend or relative. When you go into such debt, your relationship with the other party will turn sour because you will always have it in mind that you are in such situation because of a friend or relative in question.

It is not just good enough to stand as a surety for a relative or friend who wants to borrow money from a creditor or buy goods from somebody on credit just because you feel you are obliged to do so because they are your friends or relatives.

 First of all are these people credit worthy? Can you attest to their character? What are their values? Are they of worthy characters? Are they people of integrity? These you have to consider to ensure you are not heading for financial catastrophe. 

After ascertaining if they are of worthy character, consider the financial implication in case of eventuality where the person you are standing as a surety for is unable to pay the said sum of money because you are going into a contract of paying up for the financial inadequacy of another party. Think about your own financial strength. What is your worth? You cannot be worth a hundred thousand naira and think you want to stand as a surety for someone owing a hundred thousand Naira and above or even fifty thousand Naira for that matter. You should go into a suretyship where even if the said person fails to pay you can stand on your two feet financially as you well know that you can’t give what you don’t have.

 Lastly what is the reason for the person acquiring such debt? It should for a worthwhile venture that you should be happy with yourself that at least you have risked yourself for a friend or relative in need.