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longforsnow · Joined: 13 Jun 2007 Posts: 1 1.34 Dollars($)

if my brother in law has better credit than my husband,and owns a very expensive home. although my credit is around 689, my husband makes the more money of the two of us. his brother suggested he qualify because he\'d get better interest rates than quit deed the home to us. Would the same rates apply. would we than own the home ourselves or would he still be on the deed. Is this a good idea?

colin · Posted: Wed Jun 13, 2007 6:43 pm Post subject:

Hi Ana,

Welcome to Mortgagefit forum.

Apart from credit score you also need to compare income and dti ratio you have with what his brother has as for some loans credit score is not the main factor based on which a person gets approved for loan.

Now if your husband's brother purchases the house in his name and quit claims back to you, as title ownership will change lender can ask for the loan to be refinanced in your name (you need to know that quit claiming will only transfer property interest, mortgage will remain in his name). If however you do not tell the lender about the title transfer and somehow later on he becomes aware of it then he will immediately demand full pay off.

If you were to refinance that time then you will have to go through qualifying guidelines to be approved for the refinance. And you may face similar problems which you are trying to avoid right now. And it can also happen that rates go up at the time you refinance.

The advantage in his proposal would appear if he keeps the house for a certain number of years and in those years your income and credit score improves which would help you qualify for better rates on your own. And you live in the house & continue to make the payments but to not go ahead with the ownership transfer.

Colin

miller_st · Joined: 17 Jan 2007 Posts: 918 168.95 Dollars($)

jameshogg

Hi longforsnow,

If your brother-in-law qualifies for the credit, he should have his name on the title to the property. Otherwise, what you can do is, make him the cosigner so that you and your husband can have your names on the property. Also, you can use your brother-in-law's credit to qualify for the loan. And when you do, the same rates will apply. It seems to be a good idea.

Thanks

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