Thread Starter: Sullivan
Title: Re: Only using a relative as a co-signer
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I recently reviewed a notice of action taken and the lender turned the loan down because "co-signer of no relation to borrower and cannot be used". This seems to state that we only take cosigner that are relatives of the applicant (I know in the past we have taken co-signers that were not relatives). This lender indicated that we should update loan policy to this affect, but I am concerned about possible fair lending violations and dipararte discriminatory impacts. What about borrowers who don't live in the same area as their family, or whose family simply won't co-sign. I agree the relationship should be satisfactory to the bank, but isn't it a problem to state we won't use a co-signer who isn't a relative?
Thank you
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