My mom is looking to buy her first apartment. They are trying to convince me to cosign on the mortgage (my mother’s income is from her business so she is having a hard time getting approval for whatever reason).
I have been extremely adamant on the risks and negative impact to my personal credit history. However, I am not being told that being a cosigner will not affect my future chances of buying a home is I am able to provide 12 months of payments.
Is this true? How does this really work?
Will the mortgage still be on my personal history and will I still be liable for missed payments etc every month? What are the other potential downsides and risks? Any upside at all?
Co-signing a mortgage can feel like you’re helping someone take a big step forward, but there are significant risks that need to be weighed carefully. Here’s the reality:
When you co-sign, you’re agreeing to be responsible for the loan if the primary borrower (your mom in this case) can’t make the payments. The mortgage will appear on your credit report just as much as hers, and the bank will treat it like it’s your debt too. This impacts your debt-to-income ratio, which is one of the key factors lenders look at when you apply for your own loan—whether that’s for a home, a car, or anything else. It doesn’t matter if your mom makes every payment on time; from the bank’s perspective, that mortgage is yours as well.
The idea that providing 12 months of payments will “fix” this isn’t quite accurate. While making timely payments will help keep your credit in good shape, it doesn’t erase the fact that this mortgage is still on your record. It’s not just about those 12 months—it’s about the entire life of the loan. If your mom misses a payment, you’re on the hook. And missed payments will show up on your credit report, affecting your score and your financial options down the road.
Risks
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Credit Impact: This mortgage will be part of your credit history. It affects your ability to qualify for loans in the future, especially for big purchases like your own home. Lenders will see this mortgage and factor it into whether they think you can handle more debt.
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Liability: If your mom can’t make a payment, you’re responsible for it. The bank doesn’t care about the arrangement you have with your mom. If payments are missed, you will be held accountable.
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Relationship Strain: Money has a way of complicating relationships, especially family ones. If things go sideways financially, it’s not just the money at stake—it’s your relationship with your mom.
Upside?
The upside is limited. You’re helping your mom, which is meaningful. And if the loan is paid on time, your credit won’t be hurt. But there’s no financial upside for you—you’re taking on all the risks with none of the rewards. Co-signing doesn’t build wealth or improve your financial standing. You’re simply putting your financial future at risk for someone else’s benefit.
If your mom’s having trouble getting a mortgage based on her business income, that’s a sign of the risk lenders already see. You’re effectively stepping in to absorb that risk, and it’s worth asking if that’s a burden you can, or should, take on.
In the end, the decision comes down to this: are you willing to have this mortgage on your shoulders for the next 15 or 30 years, knowing that it could affect your financial future and personal goals? If not, it’s worth exploring other ways to support your mom without risking your credit and financial security.