Ask Terry Questions Co-signing on daughter’s mortgage

Co-signing on daughter’s mortgage

By Terry Savage on August 09, 2015 | Wild Card

My 67 year old fiancee has a 23 year old daughter who just graduated from college. She has only worked a few part-time jobs and has never had to pay any of her own expenses. She is getting married next July but he wants to co-sign (and pay the deposit) on a $200,000 condo for her in the Atlanta area now, 11 mos before the wedding. She is looking for a full time job but is only working part-time now making $1,200 take home per month. She will have a friend living with her and paying half the mortgage until she gets married next year. Her fiancee won’t graduate until December and will not be on the mortgage.

My thoughts are that he should wait until they are married and have had time to develop a credit and job history so they can qualify for the loan themselves for the reasons listed below:

1. The mortgage should be in both of their names since they are getting married in 11 months.
2. They will appreciate it much more if they qualify on their own and only receive help with the down payment.
3. They shouldn’t buy a house until they both have full time jobs and know how much they can affort to pay each month.
4. They shouldn’t lock themselves into a specific living location before they get jobs (Atlanta is a large metropolis) as it could hinder their job search.

Also, if her father co-signs will she be building any personal credit since the loan was co-signed?

Her father is semi-retired with a job that pays $60,000 per year plus $1,500 in military benefits per month and social security. He currently has mortgages on 3 houses: the one we live in ($3,000+ mo payment), a rental property in Atlanta ($300 mo income) and a house he financed for a nephew that is currently under water by about $70,000. He must contribute approx $300 each month to this mortgage because his nephew was hurt on the job and is unable to pay the full mortgage payment.

Please respond as soon as you can as things are heating up around here!!!

Terry Says:  I agree with you 100%.  And I put that in boldface, because I’m assuming that your fiance won’t read further.  Your analysis of the potential problems his daughter will create is completely correct.

You have just forgotten one thing:  it’s entirely possible that his liabilities will become YOURS if you marry him!  Your fiance has demonstrated a total lack of self discipline when it comes to finances.  If he is going into the hole for his nephew, just imagine what a millstone the daughter will be on your marital finances.  But, it is HIS daughter — and so this will create huge problems for your relationship with him.

Please go to this link at and order a copy of my latest book, co-written with two good friends — a divorce attorney and a divorce court judge(!) — The New Love Deal: Everything You MUST Know Before Marrying, Moving In, or Moving On.  

If his daughter won’t read it  then the two of you should read it together.  And if your finance won’t read it, then YOU should!



a personal
finance question