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Documents for Income Verification for Co-Signer

Question: 
What documents-income verification should be required of a co-signer on a mortgage as opposed to a co-applicant.
Answer: 

Randy Carey

What sort of mortgage loan are you trying to make? If someone needs a co-signer, making a Qualified Mortgage is going to be difficult.

Answer: 

Andy Zavoina

QMs aside, the FHA as an example recognizes that lenders have made co-signed mortgages. While the liability can be the same between a co-borrower and a co-signer, the benefits are not. This can relate to Reg B treatment as well as ownership of the property. Having the same liability as a co-borrower leads me to believe they would be similarly underwritten. You would follow normal verification procedures. Some underwriting rules may require special down payment and DTI calculations that exclude the co-signers funds. That is another consideration you may have to contend with based on the loan product.

First published on 06/14/2015

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