Q & A with Dottie Herman

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Q1 - How do you remove a name from a mortgage? I would like to remove my step fathers name off of my mortgage now that I can afford to pay on my own. 

A - The only way to do that would be to refinance the home under your own name and make sure the application for the mortgage is only under your name without any co-signers.

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Q2 - What is payment Shock and why does effect me? I currently live with my parents and pay nothing for rent. I am looking at a 220k mortgage and my attorney told me that the bank may be concerned with payment shock.

A - Payment shock is when you go from a very low cost of rent/mortgage to a higher cost. Banks feel that this increase will be an extra burden on you and may affect your payment responsibilities. Bank tend to consider anything over a 55% increase as payment shock

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Q3 - My husband's car was repossessed. Presently, that debt for the balance of the car is on my husband's father's credit report. How can that be? The debt is in the name of my husband and not his father's debt. Can we some how get it taken off his credit report? We are making time payments for the balance of the car.

A - You first have to contact the credit bureaus (Experian, Equifax, Transunion) and explain the issue in writing. You then need to provide proof of the ownership through finance/lease documentation. Also a letter of explanation from your father-in-law would also be helpful.

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Q4 - I have bad credit but I have taken steps to improve it and it's on the way back. However, it is presently under 600. I bought an owner financed house and I am 3 years into a 5 year deal. At the end of the contract I want to pull the equity out and buy another multi family home with the cash. And I would like advice on how or where to go. I expect my credit to be close to 700 by that time. You could cash out the equity of your home by refinancing.

A - At that point you could take the proceeds and purchase and investment property. This is all predicated on the fact that your credit score does improve. Banks are a bit stricter with credit scores and past credit history when they are dealing with a cash out refinance.

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Q5 - My Credit Scores are very good ... 746, 771, 779 but I do not work and have no income. My husband on the other hand makes 133k per year but his credit has suffered in the past. His Credit Scores are... 610, 622, 631. Can we apply for a mortgage and use my scores and his income?

A - Unfortunately no. You can be on the mortgage with your husband but most of not all lenders look at the lower of all the credit scores and use that number to make their approval / denial or rate recommendations for the mortgage.

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If you have a real estate question for Dottie, please send it to; Reporters@WorldPropertyChannel.com