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Can't get loan because of SS - or DH's dumb decision!

CandyLou's picture

SO agreed to be guarantor on mortgage for SS. At the time I said I didn't agree, I worked in a bank many years ago as a lender and know the risks involved. I also said if you do this for one child, you would have to consider it for all kids and we don't have the money to do that. SO said it will be alright, it will all work out. Fast forward...we just applied to extend our mortgage to renovate and we have been turned down due to SO co-signing on this mortgage for SS! Acting as guarantor has seriously impacted the equity in our home so we no longer qualify for more money, I am so mad! Keep in mind this is the same SS who asked SO to co-sign, then asked him to come and see the property and said, "but please don't bring CL - come on your own"!! It's fine to use me for my money, but I can't come to see where the money is going! These SK's are a major source of grief in my life!

SO feels really bad and said he is going to try and get his name off, we shall see if he is successful or not. He said he didn't think through this decision...really???

CandyLou's picture

Thanks SA, you are so right you know. He is a really sweet guy, but he cannot say no to his kids for whatever reason. So he would rather us go into debt than them? SS and his fiance earn a lot of money, they just didn't have a deposit, so now we are stuck with this loan until they pay off $100k which could take 10 years. SO will be retired by then! He rang his son and asked him directly how much money he had saved and the son said "$40k" and SO said "why isn't that going on the mortgage?" and he said "we need to get some furniture" and SO said "well we need to look at other options - we have overextended ourselves and SS said, "Okay, so long as it doesn't interfere with us getting the house" !!! Of course that is our number one consideration, not!! SO is at the bank first thing in the morning to see if he can get himself off this loan. SS has to agree and sign though.

Love what you wrote...better to ask for forgiveness then permission, so true!!

oldone's picture

Co-signing for anyone - no matter how wonderful their character and financial situation is still a huge risk.

I had perfect perfect credit, a fantastic job, etc. and I am NOT a deadbeat. But in the 80s when the economy crashed I was unemployed for over a year and had to let a house go back to the bank after I had exhausted a huge (over 100,000) savings. I kept thinking the economy would recover and held on to the house for too long (a few years) after I had moved away trying to get a new job. I had it rented but the rent was only half the house payment.

I would have died if I'd ruined my parents' credit. It was bad enough ruining mine.

sandye21's picture

Just wondering if anyone knows the answer to this question: If your DH cosigns a loan for skids without your knowledge, are you still responsible for the loan?

CandyLou's picture

Thanks for all the responses! Good question sandy, and for us the answer is yes because SO used our house as collateral on this loan. Anyway, SO is finding out how to get released from the loan. He is dealing directly with the lender to get the right answers. Since SS has this much in savings, he should be able to apply it to the loan, get his mortgage insurance and then he has to sign a release to get SO off. We shall see what happens...Moving forward, I have been in touch with my solicitor, and the house is going in both of our names which means he can no longer make these decisions without my signature, which is a huge relief. There are huge expenses coming up for both SK's and there is no way he is giving them money without my consent. Enough is enough!

Imagine how SS is going to feel now that Dadeee is no longer the guarantor! When I spoke to my solicitor, she said "big mistake" when she heard what SO did. She said she sees some nasty stuff coming through her office particularly in blended families. Then she said, "Make sure you have your wills in order as well" It was nice of her to protect me like that!

sandye21's picture

WOW! SA and Candylou, This is freaking scary! It really makes a good arguement for seeing a lawyer right after a 2nd marriage to make sure you are protected.