What is entailed when co-signing with someone trying to refinance their home?

My sister is getting into serious trouble with her home and it may be foreclosed. She bought into one of those designer mortgages several years ago and now the interest rate is ridiculously high and her mortgage is double from what she started with. If I co-sign to help her refinance her home, she could get a significantly lower (more affordable) fixed interest rate. Should I co-sign for her?





What are the risks involved? How is co-signing for a house different than co-signing for a car? How does it affect my credit? How does it affect my future with home-buying? I don't own a home yet, but what if my husband and I are ready to buy our first home in the next one to five years?What is entailed when co-signing with someone trying to refinance their home?
Buy signing a mortgage w/ your sister you are now legally responsible for the repayment of that loan. If one of you stops paying it the other has to take up the slack to avoid default and foreclosure. Your credit report will be affected (good or bad), by the mortgage.





As far as future home purchases go, the payment on your sisters house will be added to your debt ratio (making it higher), and it can affect your ability to afford a new home. The only way for you to get off of her loan is for her to refinance - on her own.





If you are confident your sister will not miss payments until she can refinance on her own then it isn't a bad idea. Maybe she just has to restore her credit which can be done in a year or so. Also, the new mortgage account on your credit report will be a solid account if it stays current. But be aware of how it will affect your ability to buy your own home later on.What is entailed when co-signing with someone trying to refinance their home?
I don't know the details of cosigning for a home loan.. but I do highly recommend that you do not do it. I would not do it and I consider myself to be a nice guy.
I would stay away from co-signing anything.





By co-signing, you, in addition to your sister, become wholly and individually responsible for the repayment of the loan. If your sister misses a payment, it will go on your credit report as well.
NO, NO, NO! Do not co-sign. Call a real estate attorney or even a mortgage broker that isn't tied to the deal and have them tell you the different scenarios. if you co-sign and your sister is late, losses her job, skips a payment...it's all on you. Your credit etc. Even if she's 5 days late it will affect your credit and when you and your husband buy a home it will affect your rate. Not to mention you may not even qualify for a loan because you will already have a mortgage. It's hard when it's family, but you have to look at this objectively. Your sister may have to sell, or contact her lender to see if she can get some help. Congress is stepping in because so many people are foreclosing due to these sub prime loans. It may take more work on her part...but even asking you to co-sign is just not cool!!! The difference between co-signing for a car vs. a house...um..$250,000???