Title / Mortgage / Promissory Note

What is the name of your state? Hawaii

I am planning to become a co-owner of a house in Hawaii. I will pay 1/2 the down payment and closing costs and will be included on the title to the property as tenants in common. (% ownership to be determined)

The other owner will pay 1/2 the down payment and make the monthly payments.

In talking with the mortgage broker, we had the following exchange:

My Question to Mortgage Broker: Could you also provide some information as to how the loan will be issued to her and I as joint borrowers (or whatever). That is, exactly how will the mortgage note read?


His Answer: To put it simply, you are considered an Accomodation Borrower, which means you are on the title and mortgage, but not on the actual promissary note. It has you as a partial owner (agreed between you and her) and not responsible for any of the payments.


So - my question to the forum: If this is actually how the Title, Mortgage, and Promissory Note will read (me on the title and mortgage but not on the note, what is my ultimate responsibility should the house be foreclosed on? What effect would a foreclosure have on my credit rating? Since I'm not on the note, would I have to disclose the loan on any future credit applications?

Sorry I couldn't be anymore concise.

[HUD-1]

Never heard of an "Accomodation Borrower". Normally, if you are on title, you have to be on the Note and Mortgage.

A co-signer would be someone who signs the note, but does not take an ownership interest.

I would have the broker check with the lender he/she is placing the loan with to make sure what they proposed to you is allowable.

[HomeGuru]

Originally posted by buyerdmg
What is the name of your state? Hawaii

I am planning to become a co-owner of a house in Hawaii. I will pay 1/2 the down payment and closing costs and will be included on the title to the property as tenants in common. (% ownership to be determined)

The other owner will pay 1/2 the down payment and make the monthly payments.

In talking with the mortgage broker, we had the following exchange:

My Question to Mortgage Broker: Could you also provide some information as to how the loan will be issued to her and I as joint borrowers (or whatever). That is, exactly how will the mortgage note read?


His Answer: To put it simply, you are considered an Accomodation Borrower, which means you are on the title and mortgage, but not on the actual promissary note. It has you as a partial owner (agreed between you and her) and not responsible for any of the payments.


So - my question to the forum: If this is actually how the Title, Mortgage, and Promissory Note will read (me on the title and mortgage but not on the note, what is my ultimate responsibility should the house be foreclosed on? What effect would a foreclosure have on my credit rating? Since I'm not on the note, would I have to disclose the loan on any future credit applications?

Sorry I couldn't be anymore concise.

**A: plain and simple, if you are going to be a co-owner you need to be on title in TC and not be a mortgage accomodator.