cosign regulations

Asked by Jessica, Fullerton, CA Mon Nov 1, 2010

I live in California and would like to sell my home and buy a bigger home. I only qualify for 70% of the amount with the deposit. Can I apply with my brother for the mortgage and have our combined income qualify? His son can live with me until I qualify for the full amount. Do current laws allow this? what are the conditions? What mortgage companies can allow this?

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Michael Mullin’s answer
Michael Mull…, Mortgage Broker Or Lender, Bend, OR
Tue Nov 2, 2010
Jessica, I'm a lender and we see co-sign applications all the time. The "laws" have nothing to do with it - however, different loan programs look at this scenario in very different ways. Conventional loan programs still require you to qualify on your own to some degree, regardless the co-applicant. FHA is the one true program that does a complete blended qualification. As others have said your co-applicant's debt will be counted as well.

If I can answer any specific questions you have about how the process works feel free to post back here or give me a call.
1 vote
Connie Bramb…, Agent, Rancho Cucamonga, CA
Tue Nov 2, 2010
Hi Jessica,
To answer directly, Yes, you may have your brother sign with you; and No he does not have to live in the home. Understand that if your brother signs with you, he will have that loan on his record as well; and may not qualify if he wants to purchase later. If that is not a problem for him, then you will be fine. Your responsibility to make payments on time is important also to his credit , as it will reflect on it as well. I live and work in your area and would be happy to meet with you if you are interviewing agents! Please give me a call.
Connie Bramble
Prudential CA Realty
1 vote
Thom Colby, Agent, Irvine, CA
Wed Nov 3, 2010
Jessica -
As Michael said, this has nothing to do with "law". It has EVERYTHING to do with buying a property with someone else in order to qualify with both incomes and both debts. You will both be on title and on the mortgage together.

Best of luck,

Thom Colby
Broker / Owner & Certified HAFA Specialist
Thom Colby Properties
Newport Beach, CA
Moving Lives Forward (TM)
We NEVER DOUBLE-END Transactions in our Brokerage. There is NO benefit to the Seller or Buyer and only benefits the Agent. Also, NEVER use your RE Agent / Broker as your Lender or vice versa. Also, be careful when using Real Estate Broker-owned Escrow and Title Companies - they can be loads of trouble.
888-391-5245 Direct Cell
DRE# 01398570
0 votes
Shannon Sung, Agent, Fullerton, CA
Tue Nov 2, 2010
Hello Jessica,
Additional documents are required to answer your question(s). Seems that you have done your research to find out your qualification upto 70% sofar. However, it would be the best to have loan documents ready in hand and contact loan officer and arrange an consultation. Prior to the consultation, please write down list of all questions you have. I can recommend few loan professionals including Brian Kim at BofA at 714 724 0900. You can work with lender of your choice. However, you will find overwhelming answers to your questions with one phone call. For real estate consultations, please do not hesitate to call me directly. Thank you. Shannon Sung / Coldwell Banker Best Realty 714 878 2335
0 votes
Leslie Eskil…, Agent, Mission Viejo, CA
Tue Nov 2, 2010
Hi Jessica -
Yes, you and your brother can apply for a loan to buy a bigger home and use your combined income to qualify. The current laws do allow this type of arrangement. Talk to a lender about the conditions - much depends on your income, assets, debts, and credit scores (FICO) - and the amount you have for a down payment. You may also have to have your current home sold by the close of escrow on your new home in order to qualify. For more on that scenario read this little article:…
I can highly recommend Janice Eckles with Met Life Home loans 949-275-3005 for all your financing questions.
Hope that helps!
Leslie Eskildsen, Realtor
Altera Real Estate
As seen in the Orange County Register:
0 votes
Melissa Krch…, , Rancho Cucamonga, CA
Mon Nov 1, 2010
You can definitely do this and, if you're getting an FHA loan, at least one of you that is on the loan has to be living in the home you're purchasing but if it's a conventional loan there aren't any requirements about who's living in the home. Almost any lender should be able to help you with this. Just make sure you're working with a lender and a REALTOR that are in constant communication and that ya'll are all working toward the common goal for all of ya'll. Let me know should you have any further questions.
0 votes
Thomas Lee, Agent, Buena Park, CA
Mon Nov 1, 2010
yes, you can have a co-signer to qualify. you could check with a loan consultant, Bob Lopez of BOA Home Loan at 714-672-4312 and tell him that I referred you.
For any other questions or second banker, if you need, let me know and I'll help you.
714-746-6164 Tom
0 votes
John Nation, Agent, Foothill Ranch, CA
Mon Nov 1, 2010
It's absolutely possible. However they will not only consider his income, they will consider his liabilities. I can help with qualification as well as the sale of your current home. Please call if I can be of help. 949-235-5412
0 votes
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