It was 1972. I was a single woman who had been working for the federal government in Washington, DC in what was then considered a high-paying job. I had been saving my money for a down payment on a house. My research had identified my preferred neighborhood, type of house, and home affordability.
The agent found the perfect house for me. It cost about $35,000 which was then a good bit of money. I was going to put down $12,000 and finance the rest.
Imagine my surprise and horror when I went to the best bank in town (the bank where I had my checking and savings accounts) to apply for a mortgage loan and was told that my father or a "man" friend would have to co-sign for my mortgage. I calmly told the loan officer that he would never impose any such conditions on a single man, that the house was superior collateral for the loan, and that I would gladly pull out my accounts and go somewhere else. He went off, probably to confer, and came back and said that the bank would give me the loan.
I decided to buy a house when the market started declining because I knew there would be a lot of good deals out there. Luckily, I work in a field that's recession restistant, so I wasn't as worried about my job as most people. I started the process, found a house I loved and found out it was in "auction status." I can't tell you how much harder that made it to buy my house! First off, buying a house from an auction company means you have to work with them, pay them extra money for "facilitating" (even though I only got two emails the entire time to ask where we were in the process. Maybe they talk to the lender more.) and in my case, and perhaps in any case, it meant that I couldn't use an FA loan, I had to use a conventional. Which caused problems, because my parents were gifting me some money left to them by my grandparents to use as a downpayment. Apparantly with a conventional loan at least 5% of the downpayment must be your money, not a gift. Of course, that wasn't explained to me upfront, I had to learn the hard way.
In the long run I did manage to finagle my way through the loan and into the house, and I'm thankful for all the people who helped me do so. But that is probably the most stressed out I have ever been!
So I was faced with an issue a few years ago. My friend had recently been involved in a car accident where his vehicle was totaled. His insurance had already declared it a total loss and were in the process of paying off his loan when they said go ahead and buy another car. Unforetunately for my friend his credit was not great and therefore asked me to co-sign with him on his loan. Ever since that day my life has not been the same. He defaulted on his loan and had his car repossessed. Now I am stuck with bad credit for a long time.
When my husband and I were buying our first home, we didn't understand the differences in mortgages. Our mortgage broker didn't really seem to try to explain what we were getting into with an ARM and we found out within the first 3 years of owning the home that we should have never went with that type of loan. I now know the difference and anytime I hear someone talking about buying a home, I warn them about the types of mortgages out there and how not to get in the situation that my husband and I had gotten into. We were lucky enough to get out of that mortgage, but would never have done it to begin with had we known exactly what an adjustable rate was.