Maybe you’ve been through or are about to go through a situation where someone close to you asks you to be their fidejussor, guarantor, or contact person for a larger loan. At first glance, it might seem like signing a document is no big deal, but before you take this step, it is essential to know what each role means and how it can directly affect your credit history.
Fidejussor – What is it and how does it affect credit?
A fidejussor is a person who assumes responsibility for paying the debt if the primary debtor does not fulfill their obligations. The fidejussor usually does not have a direct interest in the transaction but accepts the risk of intervening if the debtor cannot pay.
For example, Maria wants to buy a car on credit, and the bank asks for a fidejussor. Maria asks her sister to be the fidejussor, and she accepts. As long as Maria pays her installments regularly, the fidejussor’s credit history is not affected. However, if Maria doesn’t pay, the credit score of both parties will be affected, and the responsibility for paying the debt also falls on the fidejussor.
Guarantor – What makes it different from a fidejussor?
A guarantor is a person who assumes responsibility for paying the debt, similar to a fidejussor, but with one essential difference: the guarantor can be involved from the very beginning in recovering the money by the creditor. In other words, the bank does not need to exhaust all resources to collect from the debtor before approaching the guarantor.
For example, Mihai guarantees a business loan that his friend Andrei is applying for at the bank. If Andrei doesn’t pay, Mihai immediately becomes responsible for the debt. In this case, Mihai’s credit history will be affected if the debt is not paid, even though he is not the recipient of the loan.
Contact Person – Their Role
The contact person has no financial responsibility for the loan but plays an important role in facilitating communication between the debtor and the creditor. They are not responsible for paying the debt but only for ensuring smooth communication between the parties. If the debtor delays payment, only they will bear the consequences, and their credit history will be affected.
If you accept being a fidejussor or guarantor, it is essential to understand the risks. The debtor’s failure to pay debts can have long-term consequences on your ability to access new loans, obtain favorable financial conditions, or even rent housing. However, if the debtor pays on time, your credit history will not be affected in any way.
Whether you are a fidejussor, guarantor, or contact person for a loan, it is important to periodically check your Credit History Report at our partners www.infodebit.md to always be informed of your actual situation and avoid any surprises!
Vilena CAUTĂ, INCASO Legal Expert