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Ask Law Educator, Esq. Your Own Question
Law Educator, Esq.
Law Educator, Esq., Lawyer
Category: Real Estate Law
Satisfied Customers: 116707
Experience:  Licensed attorney practicing landlord-tenant, land use and other real estate law and litigation.
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I am interested in helping my housekeeper buy a house in Bergen

Customer Question

I am interested in helping my housekeeper buy a house in Bergen County, New Jersey. She and her husband both work and they can't get a mortgage...he apparently lost a house previously in foreclosure, so his credit rating is low. But he makes his rent every month, and I completely trust them. I would co-sign a mortgage if I could. They're paying more money in rent than they would with a mortgage (especially if I give her some money for a down payment). A mortgage broker told me that I can not cosign unless I am a family member, but I can co-sign a lease. How can I help them???
Submitted: 2 years ago.
Category: Real Estate Law
Expert:  Law Educator, Esq. replied 2 years ago.
Thank you for your question. I look forward to working with you to provide you the information you are seeking for educational purposed only.
Are you able to take the mortgage and buy the house yourself?
Customer: replied 2 years ago.
I could, but I'm wondering whether there would be a way to have the house in their name.
Customer: replied 2 years ago.
My husband also is reluctant to take on a second mortgage.
Expert:  Law Educator, Esq. replied 2 years ago.
Thank you for your reply.
If you can afford to buy the property, that would be the first step if the mortgage company will not allow you to co-sign for the loan. Once you buy the property, you can do a land trust, which allows you to get them the property and retain an ownership to guarantee the payments while she is the beneficiary of the land trust. Thus, she could obtain the benefits and get the house, but as you are the party "financing" the house you retain rights to take the house back if she fails to continue paying as agreed.
The alternative is to look for other mortgage lenders, because not all require a co-signer to be a relative, that is a rule set by each lender. The problem with this is being a co-signer makes you liable to pay if she does not pay, but you have no rights in the house and have to sue her if she breaches the contract. Thus, the land trust gives you much more control and protection.