My son would like to take over the mortgage payments of our home and want to continue to live in my house. The problem is that he won't qualify for the loan on his own due to credit score issues. I want to help him with it. He has income to make the payments, but how could we make the mortgage papers into his name? Could he refinance the mortgage? Or should we take out a new loan with me as a co owner? I have no debt and good credit history, so I think I would qualify. He will be able to sort his issues out. If he refinances, does he have to pay closing costs and all those fees again? I would like any suggestions or advice about this situation.
Fri Dec 09, 2016 3:09 am
oldguy Senior Member
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quote: I want to help him with it. He has income to make the payments, but how could we make the mortgage papers into his name? Could he refinance the mortgage? Or should we take out a new loan with me as a co owner?
The owner (mortgage company) has to agree with your plans, after all, they are on the hook to be certain that they can collect that principal over the next 30 or so years.
No, they won't authorize a name change on the loan (they want to keep you there).
Yes, he can apply for a new loan or refinance (they are almost the same ).
As for you being a cosigner - don't EVER do that. If something happens to either of you, the other will be on the hook for 30 yrs. And in 30 yrs, something WILL happen - a car wreck, sickness, divorce, death, yada. Eg, if son gets in a car wreck, kills someone, you will instantly be part of the lawsuit - probably the deep-pockets half, you can lose everything.
I would have him rent it for a few yrs until his credit rating grows, then gift the house to him so that he can apply for a mortgage on his house. And maybe you'll want to gift the rent back to him - or to his children's college funds?