Refinancing Non-Occupant Co-Borrowers Off Mortgage Guidelines

This BLOG On Refinancing Non-Occupant Co-Borrowers Off Mortgage Lending Guidelines Was PUBLISHED On April 22nd, 2019

FHA and Conventional Loans allow non-occupant co-borrowers to be added to the main borrowers in order to qualify.

  • VA Loans allow co-borrowers but it needs to be the spouse of the borrower
  • USDA does not allow co-borrowers
  • NON-QM Loans and alternative financing loan programs do allow non-occupant co-borrowers
  • Jumbo Loans depends on the lender
  • Some Jumbo lenders will allow non-occupant co-borrowers while others will not
  • Adding non-occupant co-borrowers is often common for home buyers who do not meet the minimum debt to income ratio requirements
  • However, many family members and/or relatives of the main borrower are often hesitant in being a co-signer on a loan, especially a 30 year fixed rate mortgage
  • One of the first questions co-borrowers ask is how long does my name need to be on the mortgage as a co-borrower?

In this blog, we will discuss Refinancing Non-Occupant Co-Borrowers Off Mortgage. We will cover the process of Refinancing Non-Occupant Co-Borrowers Off Mortgage.

How Does Non-Occupant Co-Borrowers Help Main Borrowers

FHA and Conventional Loans allow non-occupant co-borrowers to be added on the main borrower for qualification purposes.

  • More than one co-borrower can be added on FHA and Conventional Loans
  • With FHA, non-occupant co-borrowers need to be related to the main borrower by law, marriage, blood
  • Fannie Mae and Freddie Mac do not require any family relations to become co-borrowers
  • Multiple co-borrowers are allowed on FHA and Conventional Loans
  • Many home buyers with co-borrowers intend in Refinancing Non-Occupant Co-Borrowers Off Mortgage as soon as they can after closing on their home loans
  • There is a six month waiting period in Refinancing Non-Occupant Co-Borrowers Off Mortgage
  • Borrowers who intend in doing an FHA Streamline Refinance cannot exclude the non-occupant co-borrowers off the loan
  • Borrowers with non-occupant co-borrowers need to do a full credit/income refinance mortgage if they intend on excluding the co-borrowers on FHA and Conventional Loans

Rate and term refinance require a six month waiting period after closing on an FHA Loan. With FHA Cash-Out Refinance, borrowers need to wait 12 months. Conventional Loans do allow for cash-out refinance after six months.

Refinancing Non-Occupant Co-Borrowers Off Mortgage And The Loan Process

Refinancing Non-Occupant Co-Borrowers Off Mortgage is a new complete loan process.

  • The main borrower needs to meet the minimum credit, asset, income requirements, and mortgage guidelines
  • A new home appraisal needs to be ordered even though the home appraisal is fairly new
  • Unfortunately, the main borrower will need to pay closing costs on the new mortgage loan
  • The lender can offer lender credit to offset closing costs in lieu of a higher mortgage rate
  • A minimum of a six month waiting period is required to refinance a rate and term FHA Loan and/or 12 month waiting period to do an FHA Cash-Out Refinance
  • On conventional loans, borrowers can do either a cash-out and/or rate and term refinance mortgage after six months of closing on their original home loan
  • Mortgage rates are determined by borrower’s credit scores on FHA Loans
  • Mortgage rates on conventional loans are determined by mortgage rates and loan to value

It is best recommended that homeowners start working on improving their credit as soon as they close on their home loan if intending on refinancing non-occupant co-borrowers off mortgage to get the best possible rates.

Qualifying For Mortgage With A Direct Lender With No Overlays

Borrowers who need to qualify for a mortgage with a direct lender with no overlays, please contact us at Gustan Cho Associates at Loan Cabin Inc. at 262-716-8151 or text us for faster response. Or email us at [email protected] We are available 7 days a week, evenings, weekends, and holidays.


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