Agreeing to co-sign someone’s mortgage is not a light decision. Holding the responsibility of cosigning a mortgage is no small feat– you are placing a commitment to some else’s financial obligation. However, in this day and age, the act of cosigning a mortgage can be seen as becoming old and outdated. Traditionally used to allow hopeful homeowners to obtain larger loans or lower mortgages rates. Often the victim of poor credit scores many individuals viewed cosign mortgages as a saving grace.
There are now an abundance of low- and no-down payment loans available for homebuyers. Moreover, there are also options of down payment and closing cost assistance programs. There are other private lenders besides banks to supply loans these days. In addition, it is important to consider what type of home purchase you want, if you’re looking to do a fix and flip, look more to private lenders and hard money lenders than from the typical bank.
Before saying “yes,” it is essential to consider your own credit score, as co-signing a mortgage would make you equally obligated towards the loan and lender, so a missed mortgage payment can severely harm your credit score by 100 points. Worst case scenarios the individual will default on payments and the home go for foreclosure.
Ask yourself “is it worth the financial risk?” Unless you really trust that person, perhaps it is better to redirect them to other practices of achieving loans.
If you need a fast loan, Refresh Funding can provide Florida-based loans for individuals seeking Rehab loans for Fix and Flips. Refresh offers fix and flip rates starting at 9.99% for a 12 month term or rental loan rates starting at 7.99% for 36 month terms. We like to think of ourselves as your choice for Private Mortgage Funding & Lending. It is Refreshing to know that the bank is not your only solution– Refresh Funding.