FHA (Federal Housing Administration) Cosigner Requirements?

Yes - you can add what FHA calls a non-occupant co-borrower, they sign the Note and are fully liable for the loan. The FHA definition and rules live in HUD's guidance, so this person is treated differently than a passive cosigner. Eligibility at a glance: primary residence only, 1–4 unit properties. Standard max LTV is 96.5% when the non-occupant co-borrower is an eligible family member, and 75% max LTV if not an eligible family member.

FHA upfront and annual mortgage insurance and the statutory down payment rules do not change because of a co-borrower, but lenders often add overlays. It helps when you need extra qualifying income or to back thin credit files. It will not cure recent major delinquencies, bankruptcies within waiting periods, or severe credit derogs. If your score is just under typical cutoffs (about 580–620), try a quick credit review before adding someone. See HUD Handbook on non-occupant co-borrowers for details.

Mini checklist:

• Co-borrower must sign the Note and loan docs.
• Liability equals ownership obligation.
• Verify family status for higher LTV.
• Expect possible lender overlays.
• Try credit review first if score is marginal.

Yes - you can add a cosigner on an FHA loan, but FHA limits who qualifies and what they can do, so choose carefully.

• Eligible relatives: spouse, domestic partner, parent, child, grandparent, grandchild, sibling, step- and in-laws.
• Family-like: documented long-standing nonblood relationships may qualify case-by-case.
• Non-family: allowed, but any nonrelated cosigner typically triggers a 75% maximum loan-to-value cap.
• Legal musts: U.S. Social Security number, lawful U.S. presence, age of majority, U.S. mailing address, and required signature on application disclosures.
• Ineligible or tricky: trusts, LLCs, and most business entities cannot cosign; guardianship and recently changed marital status require clear documentation.
• Lender behavior: using a nonfamily cosigner or unusual relationship often prompts overlays and extra underwriting conditions.

Document the relationship up front, provide birth/marriage certificates or affidavits, and expect underwriters to request proofs to avoid post-approval conditions. For plain-language risks and the cosigner's legal obligations see what it means to cosign a loan.

Yes - FHA allows a cosigner who does not live in the home, they can be a non-occupant co-borrower. The borrower, not the cosigner, must intend to occupy the property within 60 days of closing and live there for at least one year. If the property is a multi-unit FHA purchase, the borrower must occupy one of the units as their primary residence.

FHA rules permit non-occupant co-borrowers, but lenders may add overlays. Common overlays require cosigners to live in the U.S., sometimes in the same state or within a set distance (for example, 100 miles), though those are lender rules not FHA requirements. A cosigner can also be on title, but local property tax exemptions and homestead benefits differ by jurisdiction, so check local rules before adding a co-borrower to ownership.

A strong cosigner typically needs a mid-600s score and reliable, documentable income to move an FHA file from marginal to smooth.

Target credit: aim for ≥620–640 for easiest AUS approvals, though FHA's floor is 580 for 3.5% down and many lenders impose higher minimum credit scores. Credit depth matters, at least 3 open tradelines with 24+ months history and clean recent housing history. If score is the only problem, pursue a rapid-rescore or dispute derogatory items before adding a cosigner.

Income and underwriting: underwriters blend the borrower's and cosigner's gross income and debts into a single DTI. W-2 pay requires stable employment and recent paystubs. Self-employed needs two years' tax returns plus YTD profit-and-loss. Retirement, alimony, or child support must be documented and likely continuable. Deal-killers include recent mortgage or rent lates, active Chapter 13 without trustee consent, undisclosed federal debts or CAIVRS hits.

Ideal Cosigner Profile:

• Credit score: 620–700+, no recent derogatories.
• Tradelines: 3+ accounts, 24+ months seasoning.
• Income: verifiable gross income, stable 2-year history if self-employed.
• Housing: on-time mortgage or rent last 12 months.
• No public-record federal debts or active bankruptcy without approval.
• Willing to provide standard FHA documentation quickly.

You and any cosigner must supply the lender a full, lender-style document stack so underwriting can verify income, identity, assets, and residency; see HUD income documentation requirements for details.

Checklist:

• Government photo ID and Social Security number verification.
• Last 30 days of pay stubs.
• Last 2 years of W-2s and 1099s.
• Last 2 years of federal tax returns, all schedules (self-employed or variable income included).
• Year-to-date profit & loss and business tax returns if self-employed.
• Most recent 2 months of bank statements, all pages.
• Verification of employment (VOE) or employer letter.
• Mortgage statements or rent history documentation.
• Proof of citizenship, permanent residency, or EAD for non-citizens.
• Relationship documentation if family LTV is used.
• Gift letter plus donor bank proof if funds are gifted.

Common gotchas to avoid: NSF fees, large unexplained deposits, or mismatched addresses will trigger conditions or delays.

Cosigning combines incomes and debts, so the cosigner's obligations raise or lower your DTI depending on their situation.

Step 1: add borrower + cosigner gross monthly income. Step 2: add recurring debts for both, include cosigner mortgage/lease, child support, alimony, and student loans (use the reported payment; if none, apply FHA's payment formula). Step 3: compute front‑end (housing payment ÷ combined gross) and back‑end (total debts ÷ combined gross). Step 4: compare to AUS automated limits and manual-underwrite thresholds; lenders may accept higher DTI with compensating factors like reserves, residual income, or a larger down payment. For official calculation rules see FHA underwriting handbook guidance.

Example (quick blended math):

• Income: you $4,000 + cosigner $6,000 = $10,000.
• Debts: you $600 + cosigner mortgage $1,200 + other $200 = $2,000.
• Front-end: proposed PITI $1,500 ÷ $10,000 = 15%. Back-end: $3,500 total debts ÷ $10,000 = 35%.
• Student loan note: if no payment on credit report, FHA formula may raise the monthly obligation and increase DTI.

Adding a cosigner can lower your rate and buyer risk, but it does not change FHA mortgage-insurance rules. The upfront UFMIP stays 1.75% and annual MIP still follows term and LTV, see FHA mortgage insurance requirements. Lenders may still charge the same MIP regardless of a cosigner.

A strong cosigner can improve automated underwriting results, trim your interest rate or win better pricing credits, and reduce required reserves. A cosigner cannot erase major derogatory credit events, and some combinations, such as a non-family cosigner, can force a lower 75% LTV allowance that effectively raises your needed down payment. Closing-costs can shift too; seller credits and buying discount points still apply, but some lenders add admin fees for complex cosigner files, so shop lenders.

Consider a quick credit tune-up instead of adding lifelong liability; modest score gains sometimes unlock similar pricing without a cosigner. If you plan to use one, compare multiple lenders and ask about overlays and any extra fees up front.

Lenders add overlays when a cosigner is used to protect against added risk and resale limits, so expect stricter rules than FHA's floor.

• Overlays are lender rules tougher than FHA. Common examples tied to cosigners: higher minimum credit score (often 620–640), lower maximum DTI than FHA allows, required cash reserves (typically 1–6 months PITIA), in-state residency or occupancy distance limits, stricter paperwork for self-employed cosigners, and some lenders ban non-family non-occupant coborrowers.
• Why they do this: investors may reject loans with cosigners, raising buyback risk for lenders. Servicing and default tracking is harder with outside cosigners. Lenders therefore tighten underwriting to keep the loan marketable and reduce loss exposure.
• What you should do: shop lenders aggressively, compare overlays, and ask direct questions about cosigner rules, required reserves, score floors, and occupancy limits. See CFPB lender shopping guidance for loan comparison tips.

There is no automatic FHA cosigner release; removing a cosigner after closing requires action by you and the lender. The two real paths are refinance into a new loan without the cosigner, or an approved assumption with a formal release of liability from the servicer if you qualify on your own.

Most lenders want proof you can carry the payment alone, so expect timing signals: 12 to 24 months of perfect payments, stronger credit scores, higher qualifying income, lower DTI, and some home equity (commonly 3–5% or more). Tactics that speed removal include paying down revolving balances, fixing credit report errors, documenting steady income, and boosting reserves. You can shorten the term when you refinance, only if the new payment is affordable. Check for prepayment penalties before refinancing, though FHA loans rarely have them. Talk to your servicer early to learn their assumption and release process, and get closing-cost estimates for refinance options.

Readiness checklist

• 12–24 months of on-time mortgage payments
• Credit scores high enough to qualify solo
• DTI lowered by paying or increasing income
• At least 3–5% home equity available
• Gather pay stubs, tax returns, and bank statements

You will face five common cosigner situations, each with clear lender concerns and a narrow set of best moves.

1. Thin-file borrower, parent cosigner.
2. High DTI borrower, sibling cosigner with an existing mortgage.
3. Non-family friend cosigner, higher LTV.
4. Self-employed cosigner, volatile income.
5. Student-loan-heavy borrower, retired cosigner on fixed income.

Case 1 - What's happening:

Borrower has limited credit history, parent adds seasoning and score. Underwriter focus: recent tradelines, gift vs. permanent obligation, reserves. Best move: have parent add a seasoned tradeline or co-sign only after 12 months of on-time payments. Watch out: parental debt counts if on credit report, FHA may require reserves. Outcome: usually approved if parent's credit and reserves are strong.

Case 2 - What's happening:

Borrower's DTI is 50%+, sibling already carries a mortgage. Underwriter focus: combined DTI, sibling's mortgage payment, occupancy intent. Best move: reduce borrower debt or increase down payment. Watch out: sibling's mortgage may push total DTI past FHA limits. Outcome: approval possible with lower DTI or larger reserves.

Case 3 - What's happening:

Friend cosigns on a 75%+ LTV loan. Underwriter focus: relationship, gift rules, overlays. Best move: document bona fide relationship and income. Watch out: some lenders add overlays or deny non-relative cosigners. Outcome: risk of added lender conditions.

Case 4 - What's happening:

Cosigner is self-employed with uneven income. Underwriter focus: two years of stable tax returns, cash flow. Best move: provide signed tax returns and 12–24 months bank statements. Watch out: fluctuating income can be discounted. Outcome: approval if income shows stability.

Case 5 - What's happening:

Borrower has large student loans, cosigner is retired on fixed income. Underwriter focus: retirement income durability, debt ratio. Best move: document pensions, SS, and reserves. Watch out: retirement income may be insufficient for added liability. Outcome: possible but needs strong reserves.

If the only gap is a 10–20 point credit score difference, fixing credit can be cheaper and cleaner than adding a cosigner.

Generally no, a non-U.S. citizen cannot simply cosign an FHA loan unless they meet FHA borrower eligibility, which after HUD's 2025 updates limits eligibility mainly to U.S. citizens and lawful permanent residents. Lenders still verify a valid Social Security number and residency status; ITIN-only cosigners are not an FHA-accepted route in practice. FHA borrower eligibility rules explain required documentation and residency tests.

If a non‑citizen has a green card, acceptable SSN, and meets income and credit requirements, they may qualify to cosign, but many lenders add overlays or disallow certain visa holders. Expect extra paperwork (EAD/I-94 when relevant), foreign income conversion and stability checks, and stricter underwriting. Shop multiple lenders and ask each about their policy on non‑citizen cosigners before you apply.

Yes - FHA allows cosigners (non-occupant co-borrowers) in many cases, but rules on who can sign, down payment, and qualifying calculations vary and are set in FHA policy and the HUD handbooks.

Is a cosigner different from a non-occupant co-borrower?

A cosigner guarantees the note but usually has no ownership interest, while a non-occupant co-borrower is treated as a borrower for underwriting and may be required to accept title depending on lender instructions. Both are fully liable for payments, and lenders use combined credit, income, and liabilities when qualifying the loan.

Will the cosigner be on the title?

Title placement depends on whether the person is a true co-borrower or only a cosigner, and on lender or state requirements; a non-occupant co-borrower often signs security instruments and may be on the deed, whereas a pure cosigner normally is on the mortgage note but not the property title. Confirm vesting choices with your lender and closing agent.

How are student loans counted for cosigners?

Underwriting uses the cosigner's reported payment on credit reports, or FHA's payment calculation when no payment is reported, which can raise the borrower's DTI significantly. Provide lender documentation to show income-driven plan payments or evidence payments are counted differently to improve qualifying chances.

Can we switch to conventional later to remove MIP and the cosigner?

Yes, refinancing into a conventional loan can remove FHA mortgage insurance premium and release a cosigner if the new lender approves and you qualify without them. Plan for credit, equity, and income requirements that are usually stricter on conventionals and confirm options with your lender and by reviewing the FHA underwriting standards for cosigners and co-borrowers.