To add someone to a mortgage, you generally have to replace the existing loan with a new one that lists both of you, either by refinancing or, if you have an FHA or VA loan, by processing a formal assumption. Lenders will not simply add a name to an existing mortgage note. The new borrower has to be underwritten and approved, and in most cases the property deed has to be updated at the same time.
Why You Cannot Just Call the Lender
A property deed says who owns the home. A mortgage note says who owes the debt. Those are two separate legal documents, and changing one does not change the other. You can sometimes add a person to the deed without lender involvement, but making someone legally responsible for the loan requires the lender’s consent, and lenders give that consent by writing a new loan rather than editing an old one.
Most conventional mortgages also contain a due-on-sale clause that lets the lender demand full repayment if ownership changes hands. Fannie Mae’s servicing guidelines authorize servicers to enforce this on most conventional loans, with narrow exceptions for certain adjustable-rate mortgages and older portfolio loans.1Fannie Mae. Conventional Mortgage Loans That Include a Due-on-Sale (or Due-on-Transfer) Provision For a conventional-loan borrower, that leaves refinancing as the realistic route.
Adding a Co-Borrower by Refinancing
A refinance pays off your current mortgage with a brand-new loan issued in both names. The old lien is released and a new one is recorded reflecting the joint obligation.2Fannie Mae. Satisfying the Mortgage Loan and Releasing the Lien The lender underwrites the new loan on the combined credit and income of both applicants. Strong co-borrower income can improve your household debt-to-income ratio and get you better terms. A weak credit file on the co-borrower can raise your rate or sink the application, because lenders typically price the loan using the lower of the two scores.
The tradeoff is cost and rate. Closing costs on a refinance generally run 2% to 5% of the new loan amount, which is roughly $6,000 to $15,000 on a $300,000 mortgage.3Fannie Mae. Mortgage Refinance Calculator Typical line items include an origination fee of roughly 0.5% to 1.5% of the loan, an appraisal in the $300 to $1,000 range, title search and insurance from $300 to $2,000, county recording fees between $20 and $250, and a small credit check charge. Some lenders advertise “no-closing-cost” refinances, but the costs are usually built into the balance or the rate rather than truly waived.
You will also get a new interest rate at today’s market. If your current rate is lower than what is available now, refinancing to add a co-borrower can raise your monthly payment even at the same balance. That is often the deciding factor.
Expect 30 to 45 days from application to closing. Underwriting eats most of that time. Both borrowers sign the new documents at closing, and the new mortgage and deed are then recorded with the county.
Adding a Co-Borrower by Loan Assumption
An assumption lets someone take on or share an existing mortgage while keeping the original rate and terms. When your existing rate is well below the market, this can be worth far more than the transaction saves in closing costs. Assumption is only available on certain loan types, and the lender still has to approve the new borrower.
FHA and VA Loans
FHA-insured and VA-guaranteed mortgages are generally assumable. For FHA loans originated after December 15, 1989, the person joining the loan has to go through a full credit qualification review under the same standards that apply to new FHA borrowers.4HUD. HUD Handbook 4155.1 – Chapter 4 Assumptions
VA loans can be assumed by anyone, including non-veterans, as long as they qualify from a credit standpoint.5Office of the Law Revision Counsel. 38 USC 3714 – Assumptions; Release From Liability There is one catch worth knowing about. If a non-veteran assumes the loan, the original veteran’s VA entitlement stays tied up until the loan is paid off. The veteran cannot use that entitlement for another VA loan unless an eligible veteran assumes the mortgage and substitutes their own entitlement.6Veterans Benefits Administration. Circular 26-23-10 VA Assumption Updates
Assumption fees are modest compared with a refinance. FHA recently raised its maximum allowable processing fee from $900 to $1,800.7HUD. FHA INFO 2024-30 – Updates to Single Family Housing Policy Handbook VA assumptions carry a 0.5% funding fee on the remaining balance, plus a processing fee that the VA caps at $300 for servicers with automatic authority.8Veterans Benefits Administration. VA Home Loan Guaranty Buyer’s Guide
Conventional Loans
Most conventional mortgages are not assumable. The due-on-sale clause gives the lender the right to call the loan due if ownership changes, and lenders routinely enforce it. If you have a conventional loan, refinancing is your path.
What the New Borrower Has to Qualify For
Whether you refinance or assume, the lender will run the new borrower through standard mortgage underwriting.
On credit score, manually underwritten conventional loans through Fannie Mae require a minimum of 620 for fixed-rate mortgages and 640 for adjustable-rate mortgages.9Fannie Mae. General Requirements for Credit Scores FHA loans generally allow scores as low as 580 with a 3.5% down payment, though individual lenders often set higher floors. When two borrowers apply together, the lower score usually sets the rate.
On debt-to-income ratio, most conventional and FHA loans want the combined figure under 43%, with FHA allowing some flexibility when the borrower has strong compensating factors like a large down payment or significant cash reserves.
The new borrower fills out the Uniform Residential Loan Application (Fannie Mae Form 1003), the standard mortgage application form.10Fannie Mae. Uniform Residential Loan Application (Form 1003) Supporting documents typically include:
- Two years of W-2s or 1099s and the most recent 30 days of pay stubs
- Two months of bank statements for checking, savings, and investment accounts
- Social Security number and government-issued ID
- Employment history covering at least the previous two years
Updating the Deed at the Same Time
Lenders generally require anyone on the mortgage note to also be on the deed. During a refinance, the lender prepares a new deed alongside the new loan documents, so the two updates happen together. With an assumption, you may need to update the deed separately, usually through a warranty deed (which promises clear title and defends against future claims) or a quitclaim deed (which transfers whatever interest the current owner has, without any promises about title). Quitclaim deeds are common between spouses and family members where the parties already trust each other.
Adding a non-spouse to the deed can trigger federal gift tax rules. Transferring a partial ownership interest without receiving equal value in return counts as a gift. For 2026, you can give up to $19,000 per recipient with no reporting obligation.11Internal Revenue Service. Frequently Asked Questions on Gift Taxes Above that, you file Form 709, though no tax is owed until your lifetime gifts exceed the $15,000,000 basic exclusion amount.12Internal Revenue Service. What’s New — Estate and Gift Tax Transfers between spouses who are both U.S. citizens are generally exempt under the unlimited marital deduction.
Co-Borrower or Co-Signer
Before you refinance or assume, decide which role the other person should actually play. A co-borrower shares both the debt and ownership of the property. Both names go on the note and the deed, and both have to agree to any future sale. A co-signer guarantees the debt without gaining ownership. Their income and credit help you qualify, but they have no claim to the home unless you also put them on the deed.
Either way, late or missed payments hit both people’s credit reports.13Federal Trade Commission. Cosigning a Loan FAQs The difference is equity: the co-borrower builds it, the co-signer just carries the risk.
The Risks of Sharing a Mortgage
Joint mortgage liability is typically joint and several. The lender can pursue either borrower for the full amount, not just a half share. If your co-borrower stops paying, the lender can come after you for the entire payment, and any private arrangement between the two of you about who was supposed to pay what does not change what shows up on either credit report.
Getting someone off the mortgage later is at least as hard as getting them on. The realistic options are refinancing into one name, selling the property to pay the loan off, or persuading the lender to release one party from liability, which lenders rarely do. A co-borrower relationship can last as long as the loan itself, potentially 15 to 30 years, so both people should treat the decision as long-term.
How Taxes Work Once You Share the Loan
Adding a co-borrower changes how the mortgage interest deduction gets claimed. Married couples filing jointly report the full deduction on their shared return. Unmarried co-borrowers have to split the deduction based on how much interest each person actually paid.
If both unmarried co-borrowers are on the loan but only one receives the Form 1098 from the lender, that person deducts only their share of the interest on Schedule A. The other borrower attaches a statement to their return explaining the split and including the name and address of the person who received the 1098.14Internal Revenue Service. Publication 936 – Home Mortgage Interest Deduction Handling this incorrectly can leave one borrower overclaiming and the other losing a deduction they were entitled to.