“Know the Implications When You Co-Sign”

“Know the Implications When You Co-Sign”

 

 

 

 

 

Hi Joe! 

I had a quick question, my dad offered to co-sign for me, would it be possible for my dad (who is retired/house paid off) to either be on the loan with me as a non-occupant or a co-signer? With the goal being to be able to up the amount of loan I can take out? Or would that not mean much for me because he is retired? Just checking-thank you!!!

 

I am asked this question pretty often and the simple answer is yes, but it has risks for the person that is co-signing.

 

Of course, the intention is to assist the borrower achieve the purpose of buying a home and often that also means taking a number of risks. What if the borrower pays a payment late? What if payments are missed? What happens if the lender looks to the co-borrower for the payments? What happens if a lender starts a foreclosure action?

Now it becomes not so simple.

 

I always want to have a conversation with the borrower and co-signer to review the risks and make sure everyone understands the possible repercussions if something goes wrong, as sometimes it does.

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Joe Petrowsky, NMLS #6869

Right Trac Financial Group, Inc. NMLS #2709

110 Main St.

Manchester, Ct. 06042

Office: 860 647-7701 x116

Fax: 860 647-8940

Cell: 860 836-9294

Email: joe@righttracfg.com

www.righttracfg.com

www.joepetrowsky.com

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Joe Petrowsky does not guarantee nor is in any way responsible for the accuracy of the information provided herein, and provides said information without warranties of any kind, either expressed or implied.

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Comment balloon 4 commentsJoe Petrowsky • June 05 2019 05:53PM

Comments

Good morning, Joe Petrowsky co-signing is risky business.... I have never co-signed for anyone.... I'd rather give a recorded second mortgage with no payment due rather than put my credit rating on the line.... I still have one second mortgage sitting there and making 5% interest.... we're on year number 14 now....

Posted by Barbara Todaro, Marketing Agent for The Todaro Team (RE/MAX Executive Realty ) 4 months ago

Co-signing for anything is risky!

You always want to have a conversation with the borrower and co-signer to review the risks and make sure everyone understands the possible repercussions if something goes wrong, as sometimes it does.

Posted by Sham Reddy CRS, CRS (H E R Realty, Dayton, OH) 4 months ago

Good morning Joe. It all seems so simple until the borrower falls on hard times and the co-signor learns of their reponsibilities! Enjoy your day!

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