Whenever you need to apply for a mortgage, but you don't meet the minimum loan application threshold, a cosigner may come with healthier financial muscle and help you qualify for the mortgage. Mostly, consigners are friends or close relatives who commit to being responsible for the loan and paying your mortgage if you default.
Who May Benefit from a Cosigner?
Primarily, a cosigner may help the following category of individuals:
What Help Does a Mortgage Cosigner Bring?
As indicated, a close relative or a friend can agree to be contractually responsible for repaying the mortgage if you default on the obligation. A cosigner comes in handy in the following situations:
Before the lender agrees to loan to you, they will first consider your cosigner's assets, liabilities, and credit history as part of your mortgage application process. These documents from your cosigner work to improve your ability to secure better borrowing terms.
A cosigner comes as a boost to the primary borrower. Contrary to a co-borrower who has shared responsibility for the debt, a cosigner vows to take care of the entire balance if you default the mortgage at any time.
What Does Your Cosigner Risk?
Requesting a relative or a colleague to cosign your mortgage should never be taken lightly. It’s an enormous financial commitment that puts your cosigner at the center of the application and risks them losing their assets or money if you default. In addition to ruining your reputation and spoiling a good friendship, a slight financial mistake on the agreed repayment terms may cause your cosigner bad credit.
Can I Remove a Cosigner?
Unfortunately, there’s no possible way to remove your cosigner from a loan. The most applicable method is through a refinance, which will require a new application and approval. If you’ve acquired and lived in your residence for some time, consider refinancing your mortgage to remove your cosigner from responsibilities attached to your mortgage.
While a cosigner may be one way to get approved and secure better mortgage rates if you have less than an excellent credit score, only include a cosigner if you are sure to make the agreed monthly payments. Also, if you are thinking of cosigning on another person's mortgage, ensure you trust them to make their monthly contributions to avoid getting yourself into unnecessary financial entanglements.
At CSMC Mortgage, we will provide you with advice to help you make sound decisions regarding mortgage financing. Please contact us online or call us directly at 805-212-7710 to speak to one of our mortgage loan originators.
“CSMC is always our go to lender. Denise Bizzy is fabulous. She really went the extra mile trouble shooting solutions to problems our client had. I do not believe another lender would have been able to pull this off. Five stars for the A+ service from Denise Bizzy and CSMC Mortgage!”
- Mark L.
“Laura Hertz is the best lender I've ever worked with in my 25 years as a Realtor. I never have to worry that she has things handles and she always performs in the best way possible. I also know that she is an advocate for my buyers and not only does she meet their expectations but she exceeds them! She is my lender for life!”
- Paula K.
“ Mario provided excellent service. Not only was he professional and helpful, but the personal support and reliability was something hard to find these days. I will not be using anyone else and have confidently referred him to friends and family.”
- Heather C.
“Faye helped me purchase my first home last year. She was very professional and worked very quickly to help me procure financing. She made herself available around my schedule and took the time to explain my options for financing to help me get the lowest rate possible. Would highly recommend her to anyone looking for someone that is professional, highly knowledgeable, polite, and responsive.”
- James Z.
“This review is about Mark and Darci Richardson from CSMC Mortage in Simi Valley. This team is the BEST! For the past 12 years our home was "underwater" due to the "crash" in 2007, and unable to do anything with the mortgage except pay it. These two kept on top of things and finally the house qualified to REFI. We just completed everything and it closed last week... and they saved us over $900 a month!! That's a huge savings for a couple of senior citizens! We are SO happy now and finally can breathe. Thanks to Mark and Darci and CSMC Mortgage for following through, jumping through all the hoops necessary and helping us out! I can't recommend them more... they are the BEST!!!”
- Shari S.
“Mark, Darci & Co were wonderful to work with! They were responsive, managed a complex buying situation with ease, incredibly communicative and always ensured I was caught up with what was going on and where I was in the process. Heavily recommend!”
- Zach J.
“ My experience is always fantastic & seamless. Mayen Grigorian is a true professional. He’s honest, he goes above and beyond, he’s efficient, always available and knowledgeable. I never have to call for updates he beats me to it and sends updates regarding the loan. Our clients are very happy and we’re very happy! Five star service, I can’t say enough good things about Mayen as a person and a professional. Hands down! He’s The Best!”
- Taline S.
“Darci, Mark and their team of professionals made the purchase for our amazing buyers absolutely seamless. The level of service they provide is second to none! They delivered the best rate and the best terms for the clients. Mark and Darci are very transparent with their fees and have a stellar reputation in the community. I highly recommend Darci and Mark for all your mortgage needs!”
- Gabby G.