Things to know about being a co-applicant | Fusion - WeRIndia

Things to know about being a co-applicant

Things to know about being a co-applicant

Co-signing a home loan is a serious financial commitment that requires deep consideration.

When you become a co-applicant or co-signor of a home loan, you are legally responsible for repaying the loan if the main borrower defaults.

It is crucial to think logically and assess your financial capability before co-signing a home loan agreement.

Here are some important points about co-signing a home loan. You can also know who can be a co-applicant of a home loan. Also, you must consider some factors before co-signing a home loan.

  • A co-applicant is a person who applies for a home loan with the main applicant. Co-owners of the property must be co-applicants, but not all co-applicants need to be co-owners.
  • The income of spouses, parents, and children can be clubbed together while applying for a home loan. However, lenders generally do not allow siblings to club their incomes unless they are co-owners of the property.
  • Husband and wife can be co-applicants regardless of being co-owners or not. However, the home loan tenure is based on the older partner’s retirement age. The lender will consider the income of both or either of their incomes while determining home loan eligibility.
  • Two brothers can only be co-applicants if they are co-owners of the property and live together in the same house.
  • Similarly, an unmarried daughter can apply for a home loan with her father or mother, but the property must be in her name to avoid disputes in the future.
  • As a co-applicant, you must understand the responsibilities you are taking on.
  • Co-signing a home loan means you are equally responsible as the main borrower. That means if anything goes wrong or the main borrower defaults, your credit score will also be affected.
  • Make sure to read the terms and conditions of the home loan agreement carefully and ask questions if you have any doubts.
  • Do not sign the agreement if you are unsure about co-signing a debt, especially if you are not a co-owner of the property.

Being a co-applicant of a home loan is a significant financial responsibility that requires careful consideration.

Understand the implications of co-signing a home loan agreement, assess your financial capability, and read the agreement terms before signing.

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