Buying a home especially if you are the first time home buyers could be complicated due to the number of formalities involved. From searching for the house, managing the finances to securing a deal, the process requires thorough research on the terminologies especially when it comes to finances. Whether you are buying the property for yourself or helping a closed one, it is important to be educated about the various terms involved in the process. Borrowing money for a home loan involves a lot of paperwork and requires a joint applicant for applying for the loan. With multiple people applying for a loan the chances of loan approval increase. There are many ways to involve another person in the joint loan application as a co-borrower, co-signer, co-owner, and co-applicant. If you are to be involved in any of the roles for home loan application then it is important to understand the difference between the terms which may look similar on the surface but has different legal implications.

So, let’s explore the difference in these titles before you apply for a home loan:

Defining for a joint home loan


A co-signer is a person who guarantees the loan for the main applicant. This approach is usually sued when the primary borrower is not able to qualify for a home loan. A co-signer needs to have a good credit history to provide surety for the main borrower. Co-signer does not have any interest or part in the property and is only there to help the borrower to qualify for the home loan and act as a backup in-case of default. However, the loan will impact the credit history of co-signer in-case of delayed payment and would be held responsible if there is a default from the primary borrower’s part.


A co-borrower is a co-applicant who shares the liability of paying back the loan along with the primary borrower. The co-borrower needs to have a strong credit history to be eligible and responsible to repay the loan in case the main borrower defaults the home loan payments. With the help of a co-borrower, the primary borrower can get a larger sum of home loans. Mostly immediate family members are the co-borrowers.


A co-owner is an individual who has the legal share and ownership right of the property as per the ownership agreement. The co-owner is responsible for the repayment of loans along with the primary borrower and entitled to tax benefits. It is mandatory for co-owner to be co-borrower but a co-borrower may or may not be a co-owner. Having a co-owner increases the chances of qualifying for a home loan as bans consider the salaries of both individuals for the loan application.

Whether you are signing as a co-borrower, co-owner or a co-signer, it is important to understand the risks involved. It is crucial to take into consideration the primary borrower’s financial stability before taking the accountability f a long term financial burden. Be well aware of your future investment plan as the loan may affect your credit history and may impact your ability to avail the loan for yourself in the coming times. Educate yourself with the legal implications and seek advice from experts to safeguard your interest.