Co-signers

Does anyone have a co-signer on their mortgage?
We don't need a co-signer, we are qualified already for a much bigger amount than we need.
I am just worried that is a small chance that my company can go out of business and screw up our mortgage. We can afford both houses we are interested in on one salary alone, plus we have 6 months of mortgage payments in the bank. I am not worried about us being able to do it, I am worried about the mortgage company taking away our mortgage if anything happens before closing. My FH and I thought about having his father or my mother co-sign just incase anything happens.
How hard it is to then remove a co-signer?

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Posted by julz33

Does anyone have a co-signer on their mortgage?
We don't need a co-signer, we are qualified already for a much bigger amount than we need.
I am just worried that is a small chance that my company can go out of business and screw up our mortgage. We can afford both houses we are interested in on one salary alone, plus we have 6 months of mortgage payments in the bank. I am not worried about us being able to do it, I am worried about the mortgage company taking away our mortgage if anything happens before closing. My FH and I thought about having his father or my mother co-sign just incase anything happens.
How hard it is to then remove a co-signer?

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Thats BAD thinking in every aspect. The only reason you want the co-signer is you think the mortgage is going to be taken away?

Thats definitely not going to happen once you get it. The bank won't give a crap whether you have zero job... or ten jobs... as long as they get their payments every month. And by the way you make it sound... you will be able to make the payments (from your mom i guess) if you lose your job.

Just bad bad bad overall to co-sign in this scenario.

Just saw that you are concerned about it BEFORE getting the mortgage.

There is still no reason to co-sign in this scenario. Fill out the bank paperwork. Give them their pay stubs. If you lose your job before you fill out the bank paperwork... then co-sign ONLY if the bank absolutely requires it.

Even if you lose your job after they get their info... most likely they will never even find out. They only did one employment verification... and if you have your job when they do the verification... then you are fine.

People get laid off all the time... banks know this. They want to lend people money and if you get another job its no biggie to them as long as its a related field.

You can always add a co-signer after the fact if you lose your job. Its VERY DIFFICULT to have a co-signer taken away and all you are doing in this situation is increasing your parents debt/income ratio and risking a ding in their credit. Not wise IMO.

I mean before closing.
What if my company goes out of business? Will they say nevermind you can't have the mortgage anymore?
Sorry I am new at this I don't know all the details. Don't they verify your employment again at closing?
The problem with my job is I will not be able to find another job immediately. It may take a few weeks...months. We will have 6 months worth or mortgage payments in the bank, plus my FH's salary. We will be fine. I also have a second job where I make tips. I can always work extra there. I am trying to say we can pay it on our own if my company goes out of business.
I just don't want to lose our mortgage at the last minute. Maybe I am just worrying too much because this probably won't happen. I just wanted a co-signer as a back-up and then remove them... Is this a bad idea?

BTW; Or parents offered to do this for us because they know the situation

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Posted by princess23

If you are really concerned maybe you can put the mortgage in just your FH's name and the title in both your names. Your FH might be able to qualify for the mortgage on his own. Just a suggestion.

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According to the online mortgage calculators...No. Almost but 50K off.

I don't think you can remove a co-signer without doing a complete re-fi.

You should be able to add one if you lose your job and your mortgage hits a halt. All the bank has to do is run your parents credit.

I am sure your mom has absolutely no problem doing this. However, Co-Signing is VERY BAD in general and should only be done at the very last minute in an emergency.

Here is a worst case senario... but something to think about when deciding to co-sign. Lets say your mom co-signs. Then a year down the road your mom accidently gets into a car accident and hurts the person she hit. Major hospital bills and pain & suffering occurs. That person can how sue your mom... AND sue against YOUR house... because your mom is a partial owner.

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Posted by nov04LIbride

I don't think the employment is a problem...FH works for a relatively small company, and I don't think they investigated...We are closing Friday and we didn't have to show pay stubs again since the 3 we handed in 2 months ago...

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IS the the way it always happens? They don't check again at closing?

I am just trying to prepare for the worst case scenario because things here at work are like a rollercoaster

How long would it take to add someone last minute?
I hear ya about the suing thing... thats why I wanted to know if it was easy to remove co-signers.
I am just being a worry-wart

I am also not saying that co-signing in every instance is bad. There are appropriate times for it.

You should co-sign if your income alone will not cover the amount of mortgage you want. Hey... every married couple theoretically 'co-signs' their mortgage.

I am also waiting (hoping) for my parent's apartment to go co-op. My parents have a very nice 3br apartment in a nice area of Woodside Queens that I am hoping goes co-op. I would co-sign a mortgage with them cause at their age a bank may not give them a loan. But me co-signing that loan would be more of a 'business partnership' and an investment opportunity since I would be benefiting out of it, I would rent my portion of the mortgage payment back to them for the time being.

But in your situation... there are no pluses to doing this. Only minuses. You are banking on something happening... that hasn't even happened yet. I would worry about it once it happens.

Also... this would be a better question to ask a mortgage broker and/or a bank officer. The bank offer will say 'hell yeah have her co-sign' cause he wants the mortgage to go through/commission. A better question for him would be... 'what if i lose my job during contract... can I get a cosigner (dont say who) to cosign the loan once the loan is in underwriting'.

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Posted by julz33

IS the the way it always happens? They don't check again at closing?

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I believe Chase called my job once... in the beginning. They may not have even called them at all. Usually they want company letterhead stating your salary and position and such.

But a 150k co-op loan is different than a 300+ mortgage. Best thing to do would be ask the bank... but phrase the question the way I said in my previous post. Don't say 'My company is downsizing CURRENTLY'. Just say 'Hey.. what if I lose my job during closing... what are my alternatives to ensure the loan gets through'.

I did some more investigating on this... since I was curious myself.

You *MAY* be able to get your parents off the hook from co-signing a mortgage... but its a real YMMV 'Your Mileage May Vary' type deal. (Meaning it may work... it may not).

You can have your parents file a 'Quit Claim Deed' to remove them from the title. Now this usually doesn't affect the mortgage (the important part)... but some banks may accept this. They will take the Quit Claim... then re-run your credit... re-verify employment... etc.

It *may* work. But then again... they may force you to re-finance... and you know what hell that can incur (especially if rates went up).


Also remember... co-signing will totally screw your taxes up as well. Your parents will have legal obligation to half of the tax breaks that you should be getting and your tax bracket won't be as low as it should be. Yeah you can always just have your mom cut you a check at the end of the year... but its still a pain in the arse.

You also might want to look at this thread.

Linky

This bank required a phone call from your employer verifying work 5 days before closing. So I guess that answers some questions. But not all banks do this. I don't recall seeing this on my committment conditions when I got my loan from Chase. I didn't even know what VVOE meant which is why I looked at the thread.

I know I saw that!!! That what I was afraid of.
I am pretty sure we are using Wells Fargo. I don't know if they do it or not!