I don't have good credit. LIke I have 512 is my score. My best friends credit is like 650 to 690. Im trying to get my credit straight but the house I want isn't going to be for sale for much longer & we need that house. We want to get my best friend to get the loan & then we pay it just like its our house. WHen we get my credit straight & the score higher than we're going to get a loan & buy it, or either refinance it. Can we refinance it in my name after my score is better?
2007-07-18 10:49:42 · 10 answers · asked by Mom 2 in Business & Finance ➔ Credit
This is a very bad idea, on both counts. Your friend is taking on a great financial risk is being liable for this house when you will be living in it. I assume that he will bear the mortgage responsibility, as well as have ownership of the property. If you cannot handle the payments, for some unforeseen reason, you are placing your friend in the position of either making the payments FOR you, or selling the house to get rid of the payments.
On YOUR side, if you do not bear responsibility for the mortgage and own the property, YOU cannot take advantage of the income tax interest and property tax deductions. Those will belong to your friend, since he owns the property and is responsible for the payments on the mortgage.
You will basically be renting from him for the costs of his monthly payments and property taxes.
Should your friend die unexpectedly, you will have NOTHING but a pile of receipts for rents paid. His estate will own the house. Even if he bequeathes the house to you in his will, he CANNOT bequeath the mortgage to you. You will be on your own.
2007-07-18 11:04:46 · answer #1 · answered by acermill 7 · 0⤊ 0⤋
I agree with the others that say this is a bad idea on both counts. This is technically mortgage fraud since you're using a straw buyer. If your credit score is that low, you may not be ready to own a house yet. Work on getting any collections removed from your credit report, lower your credit card debt to around 25% of available credit, and make all payments on time and your score will increase significantly. You really only need a score of 660 to get solid rates on 2 loans with no MI...and 620 for 1 loan with MI.
2007-07-18 11:56:46 · answer #2 · answered by ECH 2 · 0⤊ 0⤋
Yes of course. Once your credit has improved you should get approved by a lender. Although your interest rate will be higher than someone with a 700-750 score. This will increase your monthly payment amount as well. Good luck with the house.
Hope this Helps!
2007-07-18 10:58:45 · answer #3 · answered by Anonymous · 0⤊ 0⤋
i wouldnt suggest having your friend get the house for you. A Loan officer can assist you in getting the house. They will tell you what things you need to do to clean up your credit. Buying a house is treated as a very serious matter and banks dont dig when you play games like having friends get the loan and stuff like that. They wont take you seriously if you suggest such a thing.
2007-07-18 10:55:12 · answer #4 · answered by EAT! 3 · 0⤊ 0⤋
I don't recommend the friend thing, but if you do decide to do it, make sure your friend puts you on the deed immediately after escrow closes. When your credit is better, then just buy it from your friend. Another option is to enter in to a lease to own agreement with your friend. Either way, your playing with fire and putting your friendship at risk. That's just my two cents.
2007-07-18 11:03:11 · answer #5 · answered by Eddie 2 · 0⤊ 0⤋
First, do have a deposit on the house?
Second,has your friend agreed to this plan of your's? If yes,how is the financing to done,as a co-signor or a Co-mortgagor loan. Basically a co-mortgagor is considered stronger than a co-signor loan. When you refinanceshe is paid for her share(Unless pre-arranged).and part of settlement should be for her to file a quit-claim deed. Your lender can( & should) explain this to you in more detail.
2007-07-18 11:34:22 · answer #6 · answered by THE Cupid HATER 7 · 0⤊ 0⤋
I don't think it would actually be refinacing, you would have to buy it from your friend and get your own loan. Caution, this better be a very good friend. It will be his house and the law will be on his side. If he decides anything with the house, he can do it.
2007-07-18 10:54:29 · answer #7 · answered by K L 3 · 0⤊ 0⤋
I'm pretty sure you can, if not you can just buy it off of your friend when you get your credit score up
2007-07-18 10:53:31 · answer #8 · answered by prplfae 6 · 0⤊ 0⤋
we are going to be renters for a protracted time. we are dwelling in Chicago, nevertheless, and are not sure if we are going to prefer to proceed dwelling in the city in 10+ years, so we will not purchase till we parent that out. to not point out it relatively is stupid to purchase something in a important city. So costly, and the valuables taxes are insanely severe. i think of that couples who push to have their wedding ceremony and purchase a house perfect away are loopy. figuring out to purchase a house is a extensive hasstle. Uusally there are various upkeep and redesigning that is going with it, and unpredicted renovations to boot. the final component i might choose is to would desire to subject approximately that on a similar time as making plans a marriage.
2016-12-14 12:55:01 · answer #9 · answered by ? 4 · 0⤊ 0⤋
yes you can.
2007-07-18 10:54:51 · answer #10 · answered by Amy A 2 · 0⤊ 0⤋