One of the decisions you and your spouse must make when buying a single family homes for sale is determining whether a joint application is necessary for the mortgage. In some instances, it makes sense to leave one spouse off the mortgage application. If you and your spouse are debating this issue, here is what you need to know.
What Is a Good Reason to Apply Without a Spouse?
There are several reasons that applying for a mortgage loan without a spouse is a good idea. For instance, if your spouse has a low credit score or a lack of credit, the addition of him or her to the mortgage application could mean an offer with a higher interest rate. It could also mean a denial of the application altogether.
To qualify for a mortgage loan, you and your spouse must provide proof of income. If your spouse has a lack of income or low income, this could have a negative impact on your application. Depending on the lender you apply to, you and your spouse could be required to provide income proof for months or even years prior to the loan application.
Applying without your spouse is also a good idea if you want to avoid overspending on a home. There is a possibility that you and your spouse could qualify for a higher amount. With the higher approval amount, you and your spouse might be tempted to buy a home that will more than you can reasonably afford each month. With just one person being approved, the approval amount will likely be less and you and your spouse will be able to afford the home.
Are There Drawbacks?
There are some problems that can come with buying a home without your spouse. For instance, only one person's name will be on the deed. If you and your spouse buy a home in a homeowners association governed community, the board might refuse to discuss matters with the spouse who is not on the deed. This could present a challenge if your spouse needs to communicate needs or wants to the board and you are not available.
Another potential problem is that buying a home with just one spouse's name on the mortgage application means that you and your spouse are not technically building assets as a couple. Your lender might require you to obtain a quitclaim deed, which could end your spouse's claim to the property.
Talk to your real estate agent to further discuss the pros and cons of buying a home without your spouse.Share
1 August 2017
Although I've never worked professionally in the real estate business, I sure know my way around it. How, do you ask? Well, I have simply rented a lot of different places and worked with a lot of different landlords and real estate agents. In the past 7 years I've lived in 11 different houses or apartments, none of them my own. In finding those 11, I have looked at literally hundreds of apartments. I used to hate house hunting, but now it's kind of fun. You just need to know what you want and the right questions to ask. Hopefully this blog can help you learn some of the tricks of the trade from another renter like yourself.