Mortgage co-borrower is ... Borrower and co-borrower

Most often, when registering a mortgage, the amount issued by the bank is insufficient to purchase housing. In such situations, the borrower resorts to the help of a co-borrower. About that, who such созаемщик and than it can help, will be told in this article.

Who is the co-borrower

Mortgage co-borrower is a person who is responsible for a mortgage loan to the lender in conjunction with the principal borrower. In other words, he will have to repay a mortgage loan in the event that the principal borrower can not do this.

Usually, a co-borrower is resorted to in the event that the bank considers the client's income for mortgage payments insufficient. There can be two ways out: to agree to cheaper housing, or another option - a mortgage for two.

Who can become a co-borrower

Depending on the conditions and requirements of the bank, there may be several people paying the loan, but not more than four or five. Mortgage co-borrower is not only a spouse or a relative, but also any other person. However, in each bank there may be different conditions, therefore, before making a loan, it is necessary to clarify all the subtleties.

According to the legislation of the Russian Federation, a partner in a mortgage is automatically recognized as a legal spouse. However, in the event that the spouses are not willing to jointly answer for mortgage payments, or the share of the acquired residential real estate will be different, then it is necessary to conclude a marriage contract.

If the co-borrower is a friend or acquaintance of the main payer, then he must know and understand that he becomes exactly the same responsible person before the creditor, and in case of unforeseen circumstances he will have to repay mortgage payments with the right of further ownership of the housing.

Required documents

The set of documents that a mortgage co-borrower will have to provide is the same documents as for the main borrower, namely:

• Passport.
• Certificate of pension insurance.
• Document certifying registration at the place of actual residence.
• Documents certifying the identity of all those who live with him (minor children, spouse, parents).
• Employment history.
• Certificate of income confirmation.
• Document on the availability of education.
• Other documents, at the request of the bank.

Income of co-borrower

Different banks relate differently to the income of the co-borrower. Some are not so important in the size of their wages, while others are considering a candidate for a joint mortgage loan is not easier than the main borrower. For example, the co-borrower for a mortgage in Sberbank must confirm its solvency, and the amount of its wages - to meet the required percentage of payments paid. That is, it has almost the same requirements as the borrower.

Mortgage co-borrower: rights and obligations

The borrower in any situation is liable in the same way as the co-borrower for a mortgage. Ownership rights can be indicated in a mortgage loan agreement, that is, they can be either equal shares or divided into certain parts independently.

In a mortgage agreement, it is necessary to indicate the extent to which credit payments will be repaid to the extent of solidarity. So, for example, a co-borrower for a mortgage in Sberbank can pay the debt together with the borrower in equal shares. And also there is another option in which the co-borrower will pay off payments only in the event that the borrower can not do this.

In any case, the responsibility and rights are divided equally between mortgage debtors. Therefore, all financial relationships between the borrower and the mortgage partner should be documented, especially if they are not relatives.

Co-borrower and credit history

Banks are very attentive to customer credit history, that is, as in the past they repaid credit payments. For fifteen years, credit bureaus of all Russian citizens are kept in the credit history bureau. And it does not matter which bank the previous money loan was issued in, the main thing is that the credit history should be positive. This applies to the borrower and co-borrower. In the event that in one of them the history of repayment of loan loans is negative, the bank has the right to refuse to issue mortgages to both.

There is one more subtlety. In the event that the borrower is insolvent by any circumstances and the co-borrower can not independently pay off the mortgage loan, then the credit history of both will become negative. Thus, wanting to help, a person along with the main debtor can get on the list of unreliable and unscrupulous clients. And this can have a very negative impact in the future, if desired, to issue a new loan.

Co-borrower and guarantor

Many think that the co-borrower for a mortgage is the same guarantor. However, this is not so, although they have similar functions.

The Guarantor is the guarantor of the return of funds issued by the creditor, but it does not have the right to own the property or real estate acquired in the mortgage. Also, in the procedure for issuing a cash loan, the guarantor may not present to the bank a certificate of income confirmation.

Another difference between the co-borrower and the guarantor is that the guarantor's income is not taken into account when calculating the maximum loan amount and can not affect the amount of the borrower's income. But the income of the co-borrower, on the contrary, is attracted in the event that the borrower does not have a high level of wages.

As the loan repayment priorities, the surety stands in the last place, that is, the debt is initially paid by the borrower, then in the case of insolvency, the co-borrower starts paying, and only then the guarantor, if the borrower and co-borrower can not repay the loan.

Terms of the bank for co-borrower

Since the borrower and co-borrower with a mortgage have the same rights and obligations to the bank, then he sets the requirements equally. Thus, a partner in the mortgage can become a citizen of the Russian Federation no younger than eighteen years old, who is in the degree of kinship with the main borrower, and does not. One of the main conditions of the bank, guaranteeing the return of the issued mortgage loan, is the existence of a continuous work experience of at least six months at the time of filing an application.

Under the law, the borrower's spouse is automatically recognized as the co-borrower, and you can even not apply. If the spouse does not have a high level of income, then the bank can put forward a condition for issuing a mortgage loan - attracting one or two co-borrowers. Most likely, young spouses will not want to share their homes with friends or acquaintances, so they can choose parents or close relatives as assistants.

Risks

In the first place, of course, more co-borrowers are at risk, rather than borrowers for mortgages. Wanting to help, many do not think about possible consequences and possible problems. The mortgage loan is not repaid within a few months, but is taken for many years. Therefore, such troubles as illness, disability and other surprises can painfully hit the co-borrower's pocket. Especially, this applies to cases where the contract states that all duties are completely transferred to it in the situation of insolvency of the principal debtor.

It also happens that parents become co-borrowers of young spouses, making bail on their own property, and when their children suddenly divorce, turn out to be in an extremely unpleasant situation - debts and flat in pledge.

If the friends decided to help and assumed this responsibility, and after a while the borrower became insolvent and refuses to pay the loan, the bank will withhold credit payments from them. And it is good, if in the future the borrower can give the spent means to co-borrowers.

There is another peculiarity when a few people make out a mortgage. Sberbank, as well as many banks can refuse co-borrower, when he decides to buy an apartment on credit for himself because of insufficient funds in the total amount of income.

Apparently, there are a lot of risks for the co-borrower, and before becoming an assistant in such a responsible event as buying an apartment, it is worthwhile to think many times, then not to lose friends and relatives.

Credit insurance

In order not to get into an embarrassing situation, each party in the process of obtaining a loan must know its rights, including the co-borrower. The rights in the execution of a mortgage loan, as mentioned above, are very similar between debtors on a loan. But the main thing that a co-borrower needs to do is to insure himself.

As a guarantor of loan repayment, you must insure your legal capacity, and in the event of insolvency, the insurance company will already undertake mandatory payments. Thus, the insurance policy ensures timely guaranteed payments of mortgage debt in case of unforeseen circumstances.

Sometimes co-borrowers are colleagues who bought real estate for business. Accordingly, by paying together a mortgage loan, they need to insure both real estate and their legal capacity.

The insurance contract is concluded in almost all banks, especially if the loan is a mortgage. Sberbank, for example, when registering an insurance policy, in some cases cancels commissions, so that customers are most interested in the service of this bank.

Insurance is beneficial not only to co-borrowers, but also to the bank itself. It provides guaranteed payments and protects against a variety of problems, such as debt collection, financial losses.

Registration of a mortgage loan together with co-borrowers is a very serious matter, therefore, when concluding a contract, it is necessary to carefully study it and find out all the controversial issues.