Suppose that you are putting together a loan application to purchase a home. Based on your income and assets, you qualify for a mortgage loan, but just barely. How would you address each of the following situations in reporting your financial position for the loan application? In your post address each of these different situations and IF and HOW you should disclose them to your mortgage lender:

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You signed a guarantee for a bank loan that a friend took out for $20,000. If your friend doesn't pay, you will have to pay. Your friend has made all of the payments so far, and it appears he will be able to pay in the future.