{"id":8034,"date":"2023-10-16T19:18:10","date_gmt":"2023-10-16T23:18:10","guid":{"rendered":"https:\/\/migonline.com\/blog\/?p=8034"},"modified":"2023-09-28T19:21:01","modified_gmt":"2023-09-28T23:21:01","slug":"the-benefits-of-a-cosigner-on-your-homeownership-journey","status":"publish","type":"post","link":"https:\/\/migonline.com\/blog\/2023\/10\/16\/the-benefits-of-a-cosigner-on-your-homeownership-journey\/","title":{"rendered":"The Benefits of a Cosigner on Your Homeownership Journey"},"content":{"rendered":"<p>While millions of Americans chase the dream of owning their own home every year, it can be a challenging process. First-time homebuyers especially face obstacles that can derail their plans. Low credit scores, high debt, and no savings for a down payment are a few of the many issues that can cause their homebuying journey to screech to a stop.<\/p>\n<p>What can hopeful buyers do if they can&#8217;t qualify for a mortgage loan on their own? One of the best solutions is to find a cosigner.<\/p>\n<h2>What Does a Cosigner Do?<\/h2>\n<p>A cosigner is a person who agrees to shoulder the financial responsibility of the mortgage loan if the main borrower fails to meet the contract\u2019s obligations. A cosigner is essentially a co-borrower, even if they don&#8217;t reside in the property.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignright size-full wp-image-8036\" src=\"https:\/\/migonline.com\/blog\/wp-content\/uploads\/2023\/09\/cosigner1.jpg\" alt=\"\" width=\"600\" height=\"400\" srcset=\"https:\/\/migonline.com\/blog\/wp-content\/uploads\/2023\/09\/cosigner1.jpg 600w, https:\/\/migonline.com\/blog\/wp-content\/uploads\/2023\/09\/cosigner1-300x200.jpg 300w\" sizes=\"auto, (max-width: 600px) 100vw, 600px\" \/><\/p>\n<h2>When Is It Smart To Get a Cosigner?<\/h2>\n<p>Several scenarios are beneficial for buyers to get a cosigner on their mortgage loan.<\/p>\n<ul>\n<li><strong>You have credit issues. I<\/strong>f you&#8217;ve had recent late payments or other credit missteps, you may not qualify for the best mortgage loan options (or at all). A cosigner with excellent credit scores can help widen your options.<\/li>\n<li><strong>You don&#8217;t make enough money. <\/strong>If your income doesn&#8217;t meet mortgage requirements, having a parent or sibling as your cosigner shows the lender you aren&#8217;t a high risk. Since they are assured they&#8217;ll get the loan repaid (by your cosigner, if not by you), lenders are more likely to approve the mortgage.<\/li>\n<li><strong>You don&#8217;t have enough of a down payment.<\/strong> Traditional mortgage loans required several thousand dollars as a down payment. If you don&#8217;t have that saved, your choices could be limited. Enter a cosigner, who may be able to help you get approved for a loan with a smaller percentage down.<\/li>\n<\/ul>\n<h2>Benefits of Getting a Cosigner<\/h2>\n<p>Having a cosigner on your mortgage loan gives you several advantages, especially if you&#8217;re in one of the above situations.<\/p>\n<ul>\n<li><strong>You may qualify for a better interest rate.<\/strong> If you don&#8217;t have good credit, or don&#8217;t have credit at all, qualifying for a mortgage loan may be impossible. Even if you do qualify, you most likely won&#8217;t get the best rates available. With a cosigner, however, your interest rate can be based off their credit scores and financial information, which can help you attain a lower interest rate. Even a point or two lower rate can save you thousands of dollars over the life of your loan.<\/li>\n<li><strong>You may qualify for a lower down payment.<\/strong> If you don&#8217;t have a sizable chunk of money saved for a down payment, you may not be able to get into a mortgage loan. A well-established cosigner may help you qualify for a mortgage program that allows a smaller amount down.<\/li>\n<li><strong>You become a homeowner!<\/strong> If there are obstacles (like not enough income or less-than-stellar credit scores) blocking your path to homeownership, a cosigner may be the only option for getting you into a home.<\/li>\n<\/ul>\n<h2><img loading=\"lazy\" decoding=\"async\" class=\"alignright size-full wp-image-8037\" src=\"https:\/\/migonline.com\/blog\/wp-content\/uploads\/2023\/09\/cosigner2.jpg\" alt=\"\" width=\"600\" height=\"540\" srcset=\"https:\/\/migonline.com\/blog\/wp-content\/uploads\/2023\/09\/cosigner2.jpg 600w, https:\/\/migonline.com\/blog\/wp-content\/uploads\/2023\/09\/cosigner2-300x270.jpg 300w\" sizes=\"auto, (max-width: 600px) 100vw, 600px\" \/><\/h2>\n<h2>Who Can Be Your Cosigner?<\/h2>\n<p>Cosigners can&#8217;t just be anyone. Depending on the loan program you&#8217;re using, they may have to be a family member and\/or a U.S. Citizen, provide a Social Security number and meet specific credit scoring and financial requirements.<\/p>\n<p>Cosigners cannot be the property\u2019s seller, builder, real estate agent, or anyone else who has a financial interest in the property being sold.<\/p>\n<h2>What Are the Negative Aspects of Having a Cosigner<\/h2>\n<p>While there are many benefits, homebuyers need to know about a few downsides of using a cosigner to get a mortgage loan.<\/p>\n<ul>\n<li><strong>Late payments affect the cosigner&#8217;s credit.<\/strong> Cosigners are just as tied to the mortgage loan as the main borrower. Late payments or non-payments can tank a cosigner&#8217;s credit scores.<\/li>\n<li><strong>The mortgage debt can decrease a cosigner&#8217;s borrowing power.<\/strong> A cosigner may not be able to qualify for other loans because of the cosigned mortgage loan.<\/li>\n<li><strong>Cosigning can negatively affect the relationship.<\/strong> If, for whatever reason, the main borrower can&#8217;t fulfill their mortgage loan contract, if falls on the cosigner. This situation can cause friction and may damage the relationship.<\/li>\n<\/ul>\n<p>If you aren&#8217;t able to qualify for the mortgage loan you need, finding a willing cosigner may be the best way to get into a home. Think carefully about the decision and talk it over with the potential cosigner in an honest, open conversation.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>While millions of Americans chase the dream of owning their own home every year, it can be a challenging process. First-time homebuyers especially face obstacles that can derail their plans. Low credit scores, high debt, and no savings for a down payment are a few of the many issues that can cause their homebuying journey &hellip; <a href=\"https:\/\/migonline.com\/blog\/2023\/10\/16\/the-benefits-of-a-cosigner-on-your-homeownership-journey\/\" class=\"more-link\">Continue reading <span class=\"screen-reader-text\">The Benefits of a Cosigner on Your Homeownership Journey<\/span> <span class=\"meta-nav\">&rarr;<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":8035,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[122],"tags":[],"class_list":["post-8034","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-buying-a-home"],"_links":{"self":[{"href":"https:\/\/migonline.com\/blog\/wp-json\/wp\/v2\/posts\/8034","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/migonline.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/migonline.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/migonline.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/migonline.com\/blog\/wp-json\/wp\/v2\/comments?post=8034"}],"version-history":[{"count":3,"href":"https:\/\/migonline.com\/blog\/wp-json\/wp\/v2\/posts\/8034\/revisions"}],"predecessor-version":[{"id":8040,"href":"https:\/\/migonline.com\/blog\/wp-json\/wp\/v2\/posts\/8034\/revisions\/8040"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/migonline.com\/blog\/wp-json\/wp\/v2\/media\/8035"}],"wp:attachment":[{"href":"https:\/\/migonline.com\/blog\/wp-json\/wp\/v2\/media?parent=8034"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/migonline.com\/blog\/wp-json\/wp\/v2\/categories?post=8034"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/migonline.com\/blog\/wp-json\/wp\/v2\/tags?post=8034"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}