“You Ought to Be Ashamed of Yourself, Lady”: Dave Ramsey to Mom Pressuring Son to Cosign an $800,000 Mortgage

A 22-year-old from Phoenix called Dave Ramsey after his mother asked him to cosign an $800,000 mortgage. She earned around $160,000 as a physician but could not qualify alone because roughly $200,000 in Parent PLUS student loans had pushed her debt-to-income ratio too high.

“She’s kind of guilt-tripping me and saying, hey, out of everything I did for you, this is the least that you can do for me,“ Chris told the show.

Dave Ramsey was furious. “To turn around and ask a 22-year-old to help you buy a million-dollar house, you ought to be ashamed of yourself, lady,” he said. He followed with: “Suck it up, buttercup, and clean up your mess instead of dumping it on your 22-year-old.”

Dave Ramsey’s Harsh Verdict

When you cosign on a loan like a mortgage, the lender treats you as fully liable for the entire balance, and the loan lands on your credit report and your debt-to-income calculation as if it were your own.

Ramsey pointed out how cosigning would make it practically impossible for him to get his own mortgage one day: “You’re going to get married and have a kid, and you’re not going to be able to buy a house because you’re cosigned to your mother.”

The Solution Is to Lower Her Debt-to-Income Ratio

Chris’s mother earns around $160,000 and carries roughly $200,000 in Parent PLUS loans across four kids. A six-figure income sounds like more than enough for a mortgage, and in most cases it would be. However, Parent PLUS loans sit on the parent’s credit file, not the student’s, and federal Parent PLUS loans are the parent borrower’s legal responsibility to repay.

The solution is to lower the debt so the debt-to-income ratio is more favorable. Easier said than done, but Ramsey pointed out that her $160,000 annual income could go a long way to paying down the debt: “You get to live on $60,000 and put $100,000 on $200,000 worth of student loans for 2 years, and they go away. Boom! And then you have a life instead of screwing up your own kid’s life that you set out to help originally.”

Think Carefully Before Assuming Someone Else’s Debt

Co-host Jade Warshaw made an important point about the dangers of cosigning: “Cosigning is not a good thing. And the same way that you’re having problems because you cosigned, if I cosign for you, I’m signing up for the same set of problems.”

The person asking you to cosign is asking because they already could not carry the debt alone. That fact does not improve when a second name is added.

Key Takeaways

Chris should not sacrifice his own ability to get a mortgage to help his mother bypass a lender’s rejection. Her income and Parent PLUS loans create a difficult but solvable debt problem. Adding her 22-year-old son to an $800,000 mortgage would simply transfer much of the risk to him.

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