Q: My husband and I would like to buy now, but I work for the state, which just cut my salary. My husband usually makes a good wage, but was recently laid off. We have good savings, and my husband is collecting enough private unemployment insurance so that we can afford a conservative mortgage payment, but we don't qualify for a large-enough mortgage on my salary alone. Is it still possible to buy with a co-signer? How does it work?

A: Once upon a time, using a co-signer to buy a home was quite en vogue. It was a very common way for parents to help out their newlywed children. With the advent of subprime lending, the co-signer model fell largely out of use, because it just wasn't that hard for buyers with little money and marginal credit to qualify for a mortgage on their own. As mortgage qualifying guidelines have tightened up again, I've had more and more buyers ask about whether getting help from a co-signer, now known as a non-occupant co-borrower, is a possibility.  more...