My husband co-signed for a house with his sister and now we'd like to buy a new house and the loan process is getting very complicated and frustrating. Is is possible that it would keep us from getting our dream house?
2007-09-20 15:30:10 · 8 answers · asked by Krystal D 1 in Business & Finance ➔ Renting & Real Estate
The co-signed loan will be considered as one of your obligations when qualifying you for your loan. So, yes, it can affect the rate or even your ability to get another mortgage. As far as they are concerned you'd have 2 mortgages.
2007-09-20 15:35:15 · answer #1 · answered by Bostonian In MO 7 · 2⤊ 0⤋
The co-signed loan will usually be considered as part of his debt to income ratio. A very very very nice brother. I hope you sister in-law appreciates what he has done for her. He must really care for her. Maybe the loan company will accept from the sister some kind of lease or rental agreement stating that she makes the payment and will rent it out if she doesn't. I will pray that you get your loan so you too can enjoy home ownership.
2007-09-20 15:45:05 · answer #2 · answered by livigninchrist! 2 · 0⤊ 0⤋
Well, depends on the entire situation. How long ago your husband cosigned for her will be a factor, being that credit score is partially determined by age of accounts. Another factor is debt ratio because legally you husband is resposible for the payment if his sister defaults. I regret to say that there is no simple answer to your question without all of the details... My advise would be to order a tri-merge credit file for both you and your husband (which includes all 3 credit reporting agencies) and figure your debt ratio yourself including the sister's house payment. (Monthly bills minus gross income). These are your major factors in mortgage approval and good interest rates.
Hope this helps!
2007-09-20 15:48:09 · answer #3 · answered by robert h 1 · 0⤊ 0⤋
Unfortunately yes.
Cosigning does become complicated down the line. It's best to avoid cosigning if at all possible.
Try seeing if the sister could refi to have him removed.
Hopefully she kept up with all the payments and has some equity and sufficient income to do that for you guys.
If she had any lates it will affect his credit too.
Good Luck
2007-09-20 15:48:27 · answer #4 · answered by Anonymous · 0⤊ 0⤋
First thing you cant co-sign on a loan for a Mtg!! If your husband signed a mtg he is a co-borrwer and co-owner. A mtg is not a car loan.
2007-09-21 11:48:39 · answer #5 · answered by Leo F 4 · 0⤊ 0⤋
YES! He is considered a co-borrower and equally obligated on her loan. If she could refinance it on her own that would remove the debt from his name. Some lenders may allow you to prove that she makes the payments from an account that is in her name (not joint with him) and they may cut you a break
2007-09-20 15:40:46 · answer #6 · answered by Chuck92121 2 · 0⤊ 0⤋
Not sure but ask. The lender wants to make sure that you two can pay the mortgage on the home your husband co signed for, plus the home you wish to purchase for yourselves. I hope it all works out for your husband & you.
2007-09-20 15:41:16 · answer #7 · answered by Shortstuff13 7 · 0⤊ 0⤋
Yes, her debt is counted as his debt. This could seriously effect the amount of money you qualify for.
2007-09-20 15:45:18 · answer #8 · answered by Anonymous · 1⤊ 0⤋