There are inherent dangers to cosigning a mortgage

Q. My daughter and her husband want her mother to cosign their mortgage. What are the good and the bad sides of committing to cosigning their mortgage? They promise to refinance in six to 12 months to get her mother off the mortgage. Can that really happen?

A. The mother who cosigns is taking personal responsibility for the whole of the loan. It will show up as her own debt on her credit record, and any payment problems will also be listed there. That's the bad part.

The good part is that it enables the young couple to place a mortgage even though the lender isn't sure they can or will make the payments.

Can a refinance really happen? I don't know their circumstances. You have to wonder, though, how they expect to place another mortgage within the year (paying yet another set of closing costs) when they can't qualify on their own right now. And if they have reason to expect a better financial situation in a few months, why aren't they just waiting to buy later?

I don't think it does anyone a favor to help them get in over their heads. Take a look at the next letter.

About three or four years ago we made the mistake of cosigning a loan for my daughter. That loan was not paid off and we now have a lien of $20,000 on our own property. We want to sell our house, so what do we do? Do these types of liens stop real estate sales?

A. You signed a promise to pay back that loan. That's how the lien for the unpaid $20,000 ended up placed against your home. Nobody will want to buy your house with that claim against it. I'm afraid there's probably only one way of get rid of it - making good on your promise to pay it off.

No use saying "but that wasn't really our loan." When you signed the note, it became your loan.

We read about this in your column but it was not an issue then. We recently paid off our mortgage early. What information should we expect from the mortgage company and what was it we are to check on at the courthouse?

A. You don't say where you're writing from. In my state, the mortgage company is required to send a document that proves your debt has been satisfied (paid off) to your county's public records office within 30 days. There are even fines (which are never invoked, I'm sure) if that isn't done.

Give them a few months; mortgage companies are inundated these days. Then contact your public records office to find out if the document was received and recorded. If it was, that's fine - the whole world is put on notice that the debt is no longer out against your property. It won't even matter whether you have a copy in your possession.

The mortgage company may simply send it to you without having it recorded. This document is not the same as a payoff statement or a letter you may have received. It could be called a satisfaction piece, discharge of mortgage, release of mortgage, or in some states a reconveyance deed or release deed. If you receive it directly from the lender, with no information about whether it has been recorded, take it to the records office and enter it yourself. That will save problems some day in the future.

And if nothing has happened after six months, write directly to the president of your mortgage company, stating that you're sending a letter to the state agency that regulates mortgages. And do so.

Recently, a reader asked you how he or she can find tenants who do not trash the place and damage the walls. A trick I used for many years is to get a look at the renters' cars when they are applying for a rental. If it is a mess with junk scattered throughout the vehicle, I politely refuse the renter. However, if their cars are clean and neat they almost always turned out to keep the house clean and tidy. Of course, I also pull a credit report and, most of all, use intuition.

A. Yes, I've always thought the interior of prospective tenants' cars offers a handy clue to their housekeeping. Though I'm not sure you'd be impressed by what mine looks like right now.

• Edith Lank will respond to questions sent to her at 240 Hemingway Drive, Rochester, N.Y. 14620 (please include a stamped return envelope), or readers may e-mail her at ehlank@aol.com.

2009, Creators Syndicate Inc.