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.Real Estate
Eileen M. Day REALTOR
CO-SIGNING IS SERIOUS
BUSINESS A young couple want to buy their first home. They both work, make good incomes and have enough money saved for the down payment. The problem is that they don't have enough combined annual income to qualify for the home they want in tne location they want. So, they ask their parents to co-sign a mortgage. In effect, they want to use their parents' credit and income to qualify for the loan.
Parents should be advised that co-signing a mortgage is not a casual event. If the loan is defaulted, the co-signers are fully liable for the debt. So, it's a matter of trust and faith in the young couple. This is a decisjon only the parents can make.
Even with a parental co-signer, first-time buyers may be required to put up to 5 or 10 percent of the purchase price witn their own money. Some lenders also insist that the loan co-signers also appear as co-owners. This can lead to significant issues which require legal advice, a written agreement, and a will for each coowner.
If there is anything wfe can do to help you in the field of real estate please stop in at EILEEN M. DAY, Realtor, the Clopton House, Washington, Va., 22747. Phone 675-3033, We're here to help.
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