Why do my spouse and I both need to sign the participation application and loan agreement?
FEC’s loan fund is a “fixed” pool of money. Because these loans are low-interest, each time there is loss due to default, bankruptcy, or foreclosure, that “fixed” pool is reduced by that amount.
To ensure continued viability of the loan pool, FEC requires that spouses sign the participation application and loan agreement.
By signing, it ensures that all parties are informed of the obligation; it gives FEC permission to run credit reports and guarantees that the obligation will be paid if anything happens to the primary applicant.