When buying a home, there are a lot of factors to consider. One of the most important questions to ask yourself is whether or not it is in your best interest to have a co-borrower on your Kansas City home loan. In many cases, having a co-borrower can improve your chances of getting pre-approved for a mortgage.

How to Find a Good Co-Borrower

Using a co-borrower is a way for you to establish credit in order to become a homeowner. Keep in mind that co-borrowers and co-signers are different. Co-borrowers can take possession of the home and are just as financially responsible for payments as the borrower. If a borrower fails to make payments, the co-borrower will be obligated to pay this debt. Choose a responsible person with a good financial track record. There are many types of people to consider as a co-borrower for your Kansas City home loan, including:

  • Spouses
  • Mentors
  • Family
  • Longtime close friends

Credit History

Many first-time homebuyers run into a major problem: lack of credit history. This can make qualifying for a Kansas City home loan difficult to impossible at times because lenders have no proof of how you manage your debt. Having a co-borrower with good credit and an excellent FICO score will help convince lenders of your ability to repay the loan. Keep in mind that if your credit score is still below the required number, you still may not eligible for a loan regardless of your co-borrower’s status.

Debt-to-Income Ratio

Co-borrowers can help lower the debt-to-income ratio to make qualifying for a Kansas City home loan easier. When a mortgage lender looks at your debt-to-income ratio, the co-borrower’s income will be added to the total. If your co-borrower has a higher salary and less debt, the debt-to-income will be much less than it would be if you applied on your own.

Learn More About the Loan Application Process Today

Contact Cornerstone Mortgage, Inc. at (800) 965-9910


The above information is for educational purposes only. All information, loan programs and interest rates are subject to change without notice. All loans subject to underwriter approval. Terms and conditions apply. Always consult an accountant or tax advisor for full eligibility requirements on tax deduction.