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Is It Wise to Sign For a Mortgage For My Parents? – Lisa

By on September 15, 2010
Is It Wise to Sign For a Mortgage For My Parents? – Lisa

“Dear Steve,

Married, mid-30’s and working to manage our credit and stay out of debt.

I wanted to know if it is wise to sign a mortgage loan for parents. Recently, there has been a request to do so and I have a feeling in the pit of my stomach that it would not be a wise financial move for my husband and I. The request comes because of some heafty financial woes and the need for a new home. Doesn’t this stay on our credit report?

Lisa”

Dear Lisa,

While family is very important I’d have to go with No in this situation. Your parents need to address their underlying issues first before asking you to place your financial health on the line for them.

If you either sign for the mortgage or co-sign for the mortgage it is not only reported on your credit report but can reduce the amount you can borrow in the future while you are on the hook for their mortgage. What if you guys wanted to buy a new house?

Let me know more about your parent’s situation by posting a description of what is going on in the comments. Trust your gut, you are making the right choice here. We need to rescue your parents, not send you down with them.

Please update me on your progress by Choice1 Choice2 Choice3 Big Hug!
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About Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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