It is worth keeping in mind that according to the rules of some banks, only a person employed can be a co-borrower. That is, self-employed persons, individual entrepreneurs and business owners with a share of more than 5% cannot act in this role.
The co-borrower must submit to the bank the same package of documents as the borrower. In addition to the passport, you may need a certificate of income and the amount of tax of an individual or a certificate drawn up in the form of a financial institution (samples are usually available on the website). Additionally, the bank may request other documents.
Although these parties to the transaction perform the same function - they guarantee the timely repayment of the loan - there are significant differences between them:
The borrower and co-borrower are equal before the bank - they are armenia mobile database both clients of the financial institution and are equally responsible for fulfilling the obligations under the loan agreement. The guarantor is not a client of the bank, and the burden of responsibility for repaying the loan passes to him only if the borrower for some reason stops repaying the debt.
When calculating the maximum loan amount and interest rate, the bank necessarily takes into account the income and credit potential of the co-borrower. And the credit history and financial situation of the guarantor do not matter - the main thing is that he has a stable income that allows him to repay the debt if necessary.
In addition, the guarantor does not need to monitor whether the borrower complies with the payment schedule. Even if the next payment is received with a delay of a couple of days, the bank will not bother him.
Rights and obligations of the co-borrower
As mentioned above, the parties to the transaction are jointly and severally liable for the fulfillment of financial obligations under the loan agreement. At the same time, they have similar rights and obligations.
The rights of a co-borrower for a mortgage or any other loan (with or without collateral) are specified in the loan agreement. As a rule, he has the right to: