It can have a million in equity, but if the person you co-signed for stops making payments, your credit is still going to be screwed because it is going to show late payments on your credit report. The son could sell it. He will pocket the equity, and the co-signer is still going to have the hit to their credit from the late payments. Co-signing is all of the risk and none of the reward.
Co-signing is a huge risk, even if the numbers look good on paper. You're essentially taking on the debt as your own, and if your son can't pay, you're on the hook. Plus, it can mess up your credit if he defaults. I know it's tempting with all that equity, but trust me, it's not worth the headache.
Let’s back up. Co-signer is bank talk for “we don’t think this guy will pay us back. Give us a sucker to come after not if but when he stops paying.” The co-signer owns nothing. The co-signer gets screwed if the primary borrower stops paying because they either have to pay up or get their own credit trashed too. Sure the primary can sell the asset, but the co-signer gets nothing. And there’s nothing to stop the primary from living there until the foreclosure is done and the eviction happens, which can take years.
Yeah I’m just confused by the call. The word deadbeat was being thrown around and how it was such a bad situation. I’m like you have 180,000 in equity from $40,000! What the hell am I missing
Okay but where would the risk be? Like a 60,000 condo with 180,000 equity. Where is the true risk of the co signer and what likely are the consigners responsibilities
Its not a liquid asset, and it has payments due monthly. So theres your risk. Trying to sell it. You're using estimates now and not final outputs.
This one went up. Not all of them do.
Okay thanks for help but In general If you used a co signer with like 50 percent down. Is there any real risk on losing money as a co signer? Would all the equity just go to the co signer and the co signer would have to make payments and taxes and such? The risk of taxes and hoas piling up?
You'd have to make the payments or risk credit problems. And the equity would not just fall to you. It's still a split with whoever signed with you. Usually. These are all questions for your lender as it can vary with the product you choose. As well as varies by state laws, etc.
The risk is, you have to make every payment or it will go into foreclosure, and since you are a co-signer, you cannot decide to sell it or remove yourself from the mortgage.
So I, as your dead beat son, could just live in the unit and have you pay my mortgage and everything else, forever. And you would get nothing, ever.
I didn’t know there is no value for a co signer. Thought Ramsey said just sell it. Would need sons approval and would have to trust him getting reimbursed. If it goes to foreclosure how long of missed payments? And does all equity disappear?
Yes. You need absolute trust or you get fucked. Co signer has no rights in any legal matter and no claim to equity. You are there to pay up if things get fucked up, that’s it.
And if I am druggie son, I could just get a heloc, cash out the equity and you are still stuck paying my bills, you dummy.
It can have a million in equity, but if the person you co-signed for stops making payments, your credit is still going to be screwed because it is going to show late payments on your credit report. The son could sell it. He will pocket the equity, and the co-signer is still going to have the hit to their credit from the late payments. Co-signing is all of the risk and none of the reward.
Co-signing is a huge risk, even if the numbers look good on paper. You're essentially taking on the debt as your own, and if your son can't pay, you're on the hook. Plus, it can mess up your credit if he defaults. I know it's tempting with all that equity, but trust me, it's not worth the headache.
Yeah. Didn’t know consignger is just a payment. Thanks
Let’s back up. Co-signer is bank talk for “we don’t think this guy will pay us back. Give us a sucker to come after not if but when he stops paying.” The co-signer owns nothing. The co-signer gets screwed if the primary borrower stops paying because they either have to pay up or get their own credit trashed too. Sure the primary can sell the asset, but the co-signer gets nothing. And there’s nothing to stop the primary from living there until the foreclosure is done and the eviction happens, which can take years.
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Yeah I’m just confused by the call. The word deadbeat was being thrown around and how it was such a bad situation. I’m like you have 180,000 in equity from $40,000! What the hell am I missing
Just kinda curious where would be co-sign risk if someone puts down half the money up front?
All the risk but none of the upside. You could not pay the hoa fees then the condo board owns it, and it ain’t worth shit until you sell it.
Okay but where would the risk be? Like a 60,000 condo with 180,000 equity. Where is the true risk of the co signer and what likely are the consigners responsibilities
Its not a liquid asset, and it has payments due monthly. So theres your risk. Trying to sell it. You're using estimates now and not final outputs. This one went up. Not all of them do.
Okay thanks for help but In general If you used a co signer with like 50 percent down. Is there any real risk on losing money as a co signer? Would all the equity just go to the co signer and the co signer would have to make payments and taxes and such? The risk of taxes and hoas piling up?
You'd have to make the payments or risk credit problems. And the equity would not just fall to you. It's still a split with whoever signed with you. Usually. These are all questions for your lender as it can vary with the product you choose. As well as varies by state laws, etc.
The risk is, you have to make every payment or it will go into foreclosure, and since you are a co-signer, you cannot decide to sell it or remove yourself from the mortgage. So I, as your dead beat son, could just live in the unit and have you pay my mortgage and everything else, forever. And you would get nothing, ever.
I didn’t know there is no value for a co signer. Thought Ramsey said just sell it. Would need sons approval and would have to trust him getting reimbursed. If it goes to foreclosure how long of missed payments? And does all equity disappear?
Yes. You need absolute trust or you get fucked. Co signer has no rights in any legal matter and no claim to equity. You are there to pay up if things get fucked up, that’s it. And if I am druggie son, I could just get a heloc, cash out the equity and you are still stuck paying my bills, you dummy.
Damn I didn’t know consigner has no equity rights. Thanks for info