Fifth Third Bank mortgage expert answers reader questions

Fifth Third Bank mortgage expert answers reader questions


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Over the past six months, QCity Metro has asked readers to submit their home-buying questions. Below, Tori Calhoun, a senior mortgage originator at Fifth Third Bank, will answer these questions. Calhoun has been at Fifth Third for more than 13 years and has put countless customers into their dream homes.

About Tori Calhoun

Tori has received the President’s Circle Award and is consistently a Platinum Top Performer at Fifth Third. She brings a vast amount of mortgage knowledge to her customers and is able to overcome issues, challenges, provide counseling, and analyze each financial situation to make sure it is the best fit for each client’s needs. Tori is local to the Charlotte area and has lived in North Carolina all her life.

Should I co-sign my daughter’s mortgage or provide down payment funds?

Question:

I would like to assist my adult daughter in purchasing a property. Which of these options is best: Should I be a co-signer on the mortgage, meaning both my name and hers would be on the deed? Or, should I provide the funds she needs for a down payment/closing costs with just her name on the mortgage? My credit score (800s) is higher than hers. I live in Charlotte; she lives in Maryland. The property my daughter will purchase will be in Maryland, where she has lived for the past three years. She is renting there, and I am renting now in Charlotte. I sold my condo in Charlotte in January 2019, so I understand that I would be considered a first-time homebuyer since more than 3 years have elapsed since ownership.

Tori’s response:

That is very generous of you to assist your daughter with her first home purchase! She is a lucky lady! I would suggest option 2, for a few reasons. If your daughter can qualify for the home loan in her own name, it would be best to let her do that instead of jointly taking on the debt and obligation to repay it. When you co-sign for any debt, that debt becomes part of your financial obligations. By letting her do it on her own, you are not responsible for the debt, nor would you incur any credit derogatory should she default on the loan. It’s the best way to ensure that you maintain your 800+ credit rating while keeping your financial obligations low. It also allows you to remain eligible to be a first-time homebuyer again and possibly take advantage of first-time homebuyer programs since you are currently renting as well and may be looking toward home ownership again in the future. 





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