Remove a cosigner from your mortgage

Taking full ownership of your mortgage

When you first bought your home, maybe a parent, family member, or partner cosigned to help you qualify. Now you want them off the loan - maybe they need to buy their own home, maybe you just want full independence, or maybe the relationship has changed.

The most common way to remove a cosigner is to refinance the mortgage into your name only.

Why you can't just "remove" someone

Mortgage loans are contracts. Both borrowers agreed to repay the debt. The lender won't simply release one person from that obligation - they'd be giving up their backup if you stopped paying.

This is different from the property deed. You can change who's on the deed relatively easily through a quitclaim. But the mortgage is a separate legal document, and changing it requires refinancing.

Refinancing to remove a cosigner

The process is straightforward: you apply for a new mortgage in your name only, using that new loan to pay off the existing loan. The old loan (with the cosigner) is gone, replaced by a new loan (just you).

To qualify on your own, you'll need to demonstrate:

• Sufficient income - Your debt-to-income ratio must work with just your income
• Adequate credit - Your credit score needs to meet program requirements
• Enough equity - The home's value must support the loan amount

This is the same as any refinance, just with only one person applying.

What if you can't qualify alone?

If you needed a cosigner originally, you might not qualify on your own now. Options:

Wait and build - Improve your credit, increase your income, or wait for the home to appreciate. Time often solves qualification problems.

Find a new cosigner - If the issue is just wanting a specific person off the loan, you could refinance with a different cosigner (though this just shifts the issue).

Consider a different loan type - FHA loans have more flexible DTI limits than conventional. If you're close to qualifying, switching loan types might help.

Pay down other debt - Reducing your debt-to-income ratio by paying off car loans or credit cards can help you qualify.

The title question

If the person you're removing is also on the property title (deed), you'll need to handle that separately. Usually this happens at the same time:

1. Refinance closes with new mortgage in your name only
2. Cosigner signs a quitclaim deed transferring their ownership interest to you
3. New deed is recorded showing you as sole owner

If the cosigner was only on the mortgage but not the title (this is rare but happens), you just need the refinance - no deed changes required.

What about loan assumption?

Some loans (especially FHA and VA) are assumable, which could theoretically let one borrower take over. But assumptions typically require the remaining borrower to qualify on their own anyway, and the process can be more complicated than refinancing. For most situations, refinancing is simpler.

Cosigner's perspective

If you're the cosigner wanting off the loan: you can't force the primary borrower to refinance. Your best approach is to:

• Discuss a timeline for when they'll refinance
• Help them understand what they need to qualify
• Consider whether helping with their qualification (paying down their debt, etc.) is worth it to get off the loan faster

Until your name is off the mortgage, you're responsible for the debt. It shows on your credit report and affects your debt-to-income ratio for any loans you want to get.

Common scenarios

Parent helped child buy first home - A few years later, child's income has grown and they can qualify alone. Parent wants to buy a vacation home but their DTI is hurt by the cosigned mortgage. Solution: refinance into child's name only.

Unmarried partners bought together - Relationship ended amicably, one person wants to keep the house. The remaining partner refinances alone and buys out the other's equity.

Sibling or friend cosigned - Similar to parent situation. Once the primary borrower can qualify alone, they refinance to release the cosigner.

Let's see if you qualify

The first step is finding out whether you can qualify for a mortgage on your own. We'll look at your income, credit, and the property value to determine your options.

If you can qualify, we'll help you refinance into your name only. If you can't quite get there yet, we'll help you understand what needs to change.

Get a quote or schedule a call to discuss your situation.