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Cosign for a Mortgage

Who can cosign for a mortgage, and are there any restrictions? Get all the details in this guide.

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By Pete Mugleston  | Mortgage Advisor Pete has been a mortgage advisor for over 10 years, and is regularly cited in both trade and national press.

Updated: 12th November 2019 *

Getting a mortgage co-signed, or having a ‘mortgage guarantor’ as it’s also referred to, is common in the UK, especially to aid first-time buyers.

Whether you can get a mortgage co-signed, and if it’s the right route to go down, will depend on your and your prospective co-signers individual circumstances.

Fortunately, we work with a team of expert brokers who often deal with queries about this type of product, and can provide free, impartial advice that’s tailored to your personal circumstances.

Give us a call on 0808 189 2301 or submit an enquiry to speak to a specialist. In the meantime, we’ll be covering the following:

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What does it mean to co-sign a mortgage?

A co-signer is someone who signs the deeds to a mortgage alongside the primary buyer(s) if they are not qualified for the loan on their own, or to strengthen their application.

How does a co-signer on a mortgage work?

Co-signers are legally responsible for the mortgage debt, but do not own any of the property, and therefore does not appear on the property deeds.

Can you have a co-signer on a mortgage?

Yes, it may be possible to add a co-signer to your mortgage, but whether it’s the most financially sensible route to go down will depend on a number of factors.

Read on to find out more about the requirements of a co-signer, when adding one to your application may be beneficial, and when it may not be.

How much will a cosigner help me get a mortgage and what are the requirements?

So, how does getting approved for a mortgage with a cosigner make a difference? While it doesn’t necessarily make the process easier, it may well help your chances of mortgage approval.

This mainly comes down to who it is that’s offered to co-sign and their personal circumstances. For example, a close blood relative with a good debt-to-income (DTI) ratio and clean credit history could make your chances of acceptance far stronger.

On the other hand, a more distant relative, or getting a mortgage with a cosigner with bad credit history may not improve your chances at all. In fact, it could be declined or detrimental to your application. 

Be sure to speak to a specialist before making a decision as to whether you should co-sign your mortgage.

Who can co-sign for a mortgage?

This can vary from lender to lender. Some will tell you it has to be a close blood relative, such as a parent or grandparent, while others might accept friends as co-signers.

Read on to find out more...

Can parents co-sign mortgages?

Yes, parents can co-sign their child’s mortgage application, but it’s important that both parties bear in mind the significance of their financial commitment. The other consideration is that the mortgage will only be able up to the age at which the co-signer could normally get a mortgage. Depending on the age of the parents, the mortgage may have to be taken out over a shorter term.

As soon as the paperwork is complete, parents’ credit history and financial security are at risk if you as the child neglect to keep up with your repayments. 

Lenders will hold them to this agreement as a binding legal contract to state that they will be responsible for all unpaid debt.

What other family members or people can co-sign on a mortgage?

If your parent(s) aren’t in a position to act as your guarantor, you may be wondering how else you can go about finding a mortgage co-signer.

Lenders can be notoriously picky about who they are happy to act as a cosigner or guarantor on a mortgage application, although some are happy to consider less ‘conventional’ applicants.

Many lenders require a cosigner to have a direct blood relationship with the primary borrower, such as a parent or sibling. Others are more lenient and may accept a close family friend of the applicant as a co-signer.

What other factors impact how having a co-signer on a mortgage affects my application?

As with any type of loan, there are a number of other factors which can impact the likelihood of your application being approved.

The same applies in this scenario, regardless of whether you have a co-signer on your mortgage. Said factors include your credit report, the amount of deposit you have and other variables.

Read on to find out more...

Can I get a mortgage with bad credit if I have a co-signer?

Yes, it may be possible to get a co-signer mortgage if you have poor or no credit

While a cosigner can help push your application through approval, it will not erase any history of adverse you have. What’s more, some lenders have minimum credit score requirements for primary applicants even with the assistance of a cosigner. 

When applying for a mortgage,  underwriters will take various factors into account, including the loan-to-value (LTV) and debt-to-income (DTI) ratios, as well as credit score ranges. 

For example, if a prospective borrower has a low LTV, poor credit score and a DTI which doesn’t meet the minimum requirements, this individual is likely to be deemed high risk in all areas and some lenders may be dubious at offering a loan.

However, if a co-signer has a strong credit score, they have the potential to add a lot of strength to the primary borrower’s application because lenders are provided with an extra level of security.

On the flip side of the coin, you and the co-signer will be linked as financial associates, therefore your credit history may cause issues if they apply for credit themselves.

Can I get a mortgage after bankruptcy with a co-signer?

When you’re made bankrupt, your debt is normally eliminated, giving you another chance to start rebuilding your credit.

While it may be possible to obtain a mortgage from a specialist lender after 1 year of bankruptcy being discharged (provided you meet other eligibility requirements), having a co-signer on your side may certainly help your case.

How is my mortgage affordability affected with a co-signer?

As with credit history, if a prospective cosigner has a low DTI, they may have the opportunity to considerably boost the primary borrower’s application through the approval process.

Although a cosigner’s income can be used to help a buyer to qualify for the loan, again, many lenders have maximum DTI requirements which must not be exceeded by the occupying buyer(s) to be accepted.

Can I get a co-signer on a mortgage as a first-time homebuyer?

One of the most common requests for co-signer mortgages comes from borrowers with low credit scores, many of whom are first-time buyers (FTBs).

This means there’s no reason you can’t be considered for a co-signer mortgage as an FTB. However, make sure you speak to an expert to discuss all your options before rushing into anything.

Co-signer mortgage FAQ

Of course, we receive many more niche queries relating cosigner mortgages, so we’ve put together this FAQ section to offer broader coverage.

Other common questions we receive include:

How can I remove a co-signer from a mortgage?

Over time, you may want to have your co-signer removed from the mortgage. Perhaps you wish to keep your financial matters more private, or you may have built up your position enough to hold your own.

Contact your current lender to see if you qualify for the mortgage alone. Your provider will re-evaluate your income, DTI and credit profile, and review your payment history to see if you are now eligible for the without your co-signer.

What happens if my mortgage co-signer dies?

If your mortgage co-signer dies before the loan is paid in full, the responsibility will fall completely on the primary borrower.

If the main applicant defaults by the time of the co-signer's death, the cost of the loan may be deducted from the estate of the deceased. 

This is why age is another key lender consideration when it comes to co-signer mortgage applications.

How can I get out of being a co-signer on a mortgage?

Co-signing is not always the best move, so if you’ve had a change of heart or find yourself in a different financial position later down the line, there are options available.

In this situation it’s advised that you speak to the property owner and broach the concept of refinancing in their name only. After a re-evaluation, you may be able to get out of being a mortgage co-signer if they’re able to refinance as a sole owner.

Can I use a co-signer with bad credit but good income on my mortgage application?

As mentioned, having a co-signer can be very beneficial but it can also be detrimental to your mortgage application.

While lenders will consider a number of factors in-depth before determining whether to approve your application, if, for example, your co-signers high DTI doesn’t counteract the severity of their credit score, it may not work in your favour.

As always, it’s very much situation-dependent, so get in touch for bespoke, independent advice.

Can I get pre-approved for a mortgage with a co-signer?

While the addition of a co-signer to a mortgage application can certainly work in a borrower’s favour, it certainly doesn’t guarantee that your loan will be pre-approved.

Lenders are scrupulous and want to be absolutely certain that they’re confident with your repayment ability,  so you and your co-signer will be subject to a number of other eligibility checks.

What’s the difference between a guarantor and co-signer mortgage?

The main difference between being a guarantor and co-signer relates to liability. 

A co-signer signs the debt and is contractually liable for any missed repayments without the bank needing to take any specific action to demand co-signer payment. 

However, a guarantor does not sign the debt obligation, and to become financially liable, the lender must exhaust all other means of collecting the funds from the original borrower(s).

Mortgage cosigner vs mortgage co-borrower: what’s the difference?

In the eyes of the FCA and your mortgage lenders, ‘co-signers’ and ‘co-borrowers’ are two separate things. 

A co-borrower will apply for a loan alongside the primary applicant, and both parties share responsibility for the repayments. Co-signers are not intended to make any payments, as this is down to the primary borrower.

Speak to a specialist for advice about having a co-signer on a mortgage

Having a co-signer on your mortgage can help push your mortgage application through the approval process if your financial situation isn’t ideal, but it’s not always the right route to go down and shouldn’t be taken lightly.

The whole-of-market brokers we work can offer you bespoke, impartial advice and advise you on the best route to go down.

So give us a call on 0808 189 2301, or submit an online enquiry and one of the experts will be in touch.

We only work with 5* accredited advisors, we don’t charge a fee, and there’s absolutely no obligation on your part.

Updated: 12th November 2019
OnlineMortgageAdvisor 2020 ©

FCA disclaimer

*Based on our research, the content contained in this article is accurate as of most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The info on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms who are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs. Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.

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