If your private student loans are in default, you're not out of options. Go to whyrefi.com

slash Ramsey. Today's question comes from Jessica in Illinois. Before getting serious about following

the baby steps, I co-signed a car loan for my 22-year-old daughter. I have two credit card

balances to tackle besides her car, and I will be debt-free. She owes $12,000 on the car, and I have $20 card balances to tackle besides her car and I will be debt free.

She owes $12,000 on the car and I have $20,000 in credit card debt.

Do I finish paying my personal debt and move on to Baby Step 3 or do I include her car note in my debt snowball?

She has not missed a payment and has not asked for help paying, but I just really want to be done with it so it's not hanging

over both of our heads. That being said, I'm so, I'm also nervous about only having my

starter emergency fund and savings that want to move on to Baby Step 3 as soon as possible.

Tell her, Dave.

Well, we're going to pay off the car after you pay off your credit cards because the car is under control right now.

It's not in panic.

So we'll put it at the back of the debt snowball and clear your credit cards and then clear the car.

And then work something out with your daughter so that she repays you since you're paying off her car early.

Okay.

Because there's several problems um with this that that lay in the future if

she gets laid off gets in a car wreck as a medical event anything like that this is going to

come back on you it's what we call a contingent liability which means it's a liability and meaning they're going to come after a liability, and meaning they're going to come after you.

And by the way, they're going to come after you really fast, and they're going to skip over her

because they never thought she was going to pay it in the first place.

That's why they wanted a co-sign her.

And so they're going to come straight at you if something goes wrong.

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