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Blueblue7

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Does cosigning on a mortgage lower credit rating?

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Top Contributor
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Depends on many factors.  Think very hard on this; when you co-sign something, you are guaranteeing that the payments will ALL be made on time and you are committing yourself to this promise for the entire duration of the mortgage which can be for 15 to 30 years because the credit of the one you are co-signer for is insufficient for them to ibe trusted with the entire mortgage. Are you ready, willing and able to pay for a house that someone else will be living in?  I advise AGAINST co-signing on all levels since it is far too risky.

Top Contributor
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To your question,

As with any new loan, It will lower your credit rating for a while, Until payments have been made and the Credit Bureaus are satisfied that the payments will continue uninterupted, usually for several months. 

In the long run, if payments are made on time as agreed, you should see a small rise in your avereage rating. 

As with the other response, I too advise against co-signing, Unless you have the extra cash that you can use to make that monthly payment with out hurting your own budget, then it is generally to risky.

 If I could afford it, Rather than co-signing, I would purchase the home myself and then do a "rent to own" agreement with the other person for a few years. They would pay rent of about 25% higher than the monthly paymentto you,  You pay the loan, In 5 years or so you apply say 75% of the monthly rent that they have paid you towards the balance and they can try for a new loan to buy the home outright from you.  

Just my thoughts, Hope that helps. 

Good luck 

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