Can I refinance my parents' home in my name for them and still get financed for my own? Thanks.
-- Cory Credit
It's possible. You'll have to have enough
income and the credit score to carry both mortgages.
Co-signing a mortgage loan with your parents will
result in the same credit issues as refinancing
their home solely in your name, so you can't finesse
the issue by co-signing the loan.
haven't told me how big the refinancing would be, or what size mortgage you're
looking to finance for your personal residence, but lenders typically won't underwrite
a loan when your total loan payments are more than 36 percent to 40 percent of
your monthly gross income.
The Bankrate calculator, "How
much house can you afford?" will give
you an idea as to how much of a mortgage you can
afford on your income if you were financing your
parents' home too.
There are other issues to consider as well. The lender
has a security interest in the property. The borrower is typically the owner of
the property. Your parents giving a lender a security interest in their home
to secure your loan is likely to be an obstacle in the financing, even if you're
doing it to help them out. Without applying for a loan, talk to a lender
in your area to ask how it's done in your state or consult with a real estate
Take a step back and ask yourself
what you're trying to accomplish in refinancing
your parents' home in your name. You may
be able to figure out a different solution than
refinancing the home in your name.