Getting Approved for a Loan with a Co-Signer

You have a dilemma... you already have an FHA mortgage, so you cannot go FHA, but if you could, they would allow a "non occupying co borrower", or your step-mother. Under conventional guidelines, you cannot have a "non occupying co borrower", unless it's a purchase for a son or daughter or mother father (kiddy Condo)... if your step mother was going to live in the property, assuming she does not have another home with a mortgage, then she could purchase the home, use FHA financing, and use you as the non occupying co borrower. She would have to live in the property, and I guess you could move in as well.. the problem with your original scenario, is it looks very much like a "Buy and Bail"... you see a home in your neighborhood... it's a lot like yours, maybe even bigger and better, but at a much lower price.. You decide to purchase the new home, tell the lender you're going to lease or rent out your existing home, and as soon as the new loan is closed, you walk away from the other home... I'm not saying this is your intent at all... I'm just saying, that your scenario will look like this to a lender, so you have to have story that makes sense for the lender to approve it... you really should get with someone that knows underwriting and lender guidelines really, really well.. so the best advice I can give you is to contact a LOCAL mortgage broker, not the local "Big" bank, and certainly not one of those 50 states internet lenders...By applying with your LOCAL Broker, you have an advantage because he's familiar with local customs and works with numerous lenders, seeking out the best loan terms for your particular scenario. Because he has lower overhead, he can offer you lower rates and lower fees than most of the larger lenders.. The broker also has to have mandatory education, which your local bank teller/ loan officer does not have. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

hi: with a 48% debt to income is reasonable. All approvals are run thru an Automated system. Do you have any other assets (401k, cd's, mutual funds) all those components play a factor in determining a decision. A co signer with would assist based on your above information provided. Note: to determine pricing/rate, rate is usually determined by the lowest 2nd highest score borrower......May I ask how much you are able to put down as down payment? Mike 703 505 5300 (mconvin@emeryfs.com) NMLS # 754875

hi again: where is the property u are purchasing in? worse case we can still go with a stated income program based on high credit scores etc. Mike (703 505 5300) NMLS #754875

Adding a non-occupying co-borrower will not benefit you on a conventional loan. Since you currently have a FHA loan you are not eligible for another FHA loan. Also please keep in mind that since you do not have a history of owning a investment you will need 30% equity in your current residence to be able to offset the payment on your current residenceGood Luck www.tlclender.com

You didn't say whetrYou didn't say if you intend to move into the new home as our new primary residence and rent the old one or purchase the new home as a rental. If your intent is to make the new property a rental, you will need 30% down and conventional financing will be the way to go. If you are looking at turning your current home into a rental, it is going to be very difficult as William says. Too many people before you have "legitimately purchase a new home and then when they couldn't easily find a renter, mailed the keys back. Lenders are skittish and regardless of your intent, you are impacted by the actions of others. The direct answer to your question about a non-occupant co-borrower doesn't work with conventional and you can't have another FHA, so you will need to qualify on your own. Good luck with whatever you decide to do. ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ www.LoansA2z.com