075: Mortgages And Cosigning
Faith and Finances
English - October 27, 2017 07:00 - 33 minutes - 23.4 MB - ★★★★ - 13 ratingsChristianity Religion & Spirituality Business Investing bible christ personalfinance Homepage Download Apple Podcasts Google Podcasts Overcast Castro Pocket Casts RSS feed
In This Episode, We Look At:
A Mortgage is not Consumer debt weighing on your shoulders.
No one is going to offer to buy your credit card debt
A mortgage should not be viewed as a sin, citing Romans 13:8 "Owe no man any thing".
The Bible warns about being/staying in debt and encourages prompt repayment.
If borrowing were a sin and not simply frowned upon, then we would be enablers to others' sin because the Bible encourages us to be liberal in lending and ready to forgive!
Deut. 28:12, Psalm 37:21,26
You can sell your home, and the mortgage balance is taken on by the buyer (and you may pocket some equity in the proceeds).
It is leverage; you can live in that home as long as you make the payments. It is the cost of living in your chosen home.
Long-term
Buying a home with a mortgage is not a short-term purchase. There is more risk of loss in the short-term due to fluctuating values.
Your primary residence is NOT an investment
It is a cost.
It is collateral.
Cosigning for a loan. Nope!
A credit score is intended to reflect one's financial responsibility and history of paying bills on time.
If a grown child's credit score is not sufficient to get their mortgage, then it is self-evident… perhaps they should not take on a mortgage.
Co-signing is assuming the responsibility for the debts of another person. If the person who you signed up to help does not make the payments—you are legally responsible.
Scripture teaches not to do it:
Proverbs 11:15 He that is surety for a stranger shall smart for it: and he that hateth suretiship is sure.
Proverbs 22:26-27 Be not thou one of them that strike hands, or of them that are sureties for debts. If thou hast nothing to pay, why should he take away thy bed from under thee?
The FTC states: "You are being asked to guarantee this debt. Think carefully before you do. If the borrower does not pay the debt, you will have to. Be sure you can afford to pay if you have to, and that you want to accept this responsibility."
And… "The creditor can collect this debt from you without first trying to collect from the borrower.* The creditor can use the same collection methods against you that can be used against the borrower, including suing you or garnishing your wages. If this debt is ever in default, that fact may become a part of your credit record."
“When I sign for someone else, I am saying, “I will answer for all of this person’s financial decisions, wise or unwise. I’m now legally and financially accountable for whatever he chooses to do.”
—Randy Alcorn
Resources and Links:
Improve Your Faith and Finances:
If you desire to help an adult child, prayerfully consider avoiding cosigning on a loan. Help by gifting some money or offer counselling and advice.
Share Your Thoughts:
If you have a question or comment about today's topic, we invite you to share your thoughts.
Podcast on Facebook
Tim Twitter
Troy Twitter
In This Episode, We Look At:
A Mortgage is not Consumer debt weighing on your shoulders.
No one is going to offer to buy your credit card debt
A mortgage should not be viewed as a sin, citing Romans 13:8 "Owe no man any thing".
The Bible warns about being/staying in debt and encourages prompt repayment.
If borrowing were a sin and not simply frowned upon, then we would be enablers to others' sin because the Bible encourages us to be liberal in lending and ready to forgive!
Deut. 28:12, Psalm 37:21,26
You can sell your home, and the mortgage balance is taken on by the buyer (and you may pocket some equity in the proceeds).
It is leverage; you can live in that home as long as you make the payments. It is the cost of living in your chosen home.
Long-term
Buying a home with a mortgage is not a short-term purchase. There is more risk of loss in the short-term due to fluctuating values.
Your primary residence is NOT an investment
It is a cost.
It is collateral.
Cosigning for a loan. Nope!
A credit score is intended to reflect one's financial responsibility and history of paying bills on time.
If a grown child's credit score is not sufficient to get their mortgage, then it is self-evident… perhaps they should not take on a mortgage.
Co-signing is assuming the responsibility for the debts of another person. If the person who you signed up to help does not make the payments—you are legally responsible.
Scripture teaches not to do it:
Proverbs 11:15 He that is surety for a stranger shall smart for it: and he that hateth suretiship is sure.
Proverbs 22:26-27 Be not thou one of them that strike hands, or of them that are sureties for debts. If thou hast nothing to pay, why should he take away thy bed from under thee?
The FTC states: "You are being asked to guarantee this debt. Think carefully before you do. If the borrower does not pay the debt, you will have to. Be sure you can afford to pay if you have to, and that you want to accept this responsibility."
And… "The creditor can collect this debt from you without first trying to collect from the borrower.* The creditor can use the same collection methods against you that can be used against the borrower, including suing you or garnishing your wages. If this debt is ever in default, that fact may become a part of your credit record."
“When I sign for someone else, I am saying, “I will answer for all of this person’s financial decisions, wise or unwise. I’m now legally and financially accountable for whatever he chooses to do.”
—Randy Alcorn
Resources and Links:
Improve Your Faith and Finances:
If you desire to help an adult child, prayerfully consider avoiding cosigning on a loan. Help by gifting some money or offer counselling and advice.
Share Your Thoughts:
If you have a question or comment about today's topic, we invite you to share your thoughts.
Podcast on Facebook
Tim Twitter
Troy Twitter