Buying a House Without Your Spouse: Your Mortgage Questions Answered - Quicken Loans Zing BlogTying the knot comes with a lot of financial implications. It can raise your taxes. It can lower them (if you’re lucky). It can affect the types of retirement accounts you can get. It can affect how much you pay for insurance. And, in some cases, it can even affect your mortgage.

There are a lot of things to consider when you’re getting ready to buy a house. But if you’re married, one that you might not have thought about is whether you and your spouse should both be on the home loan. In some cases, having only one spouse on the mortgage might be the best option.

If you’re looking to get a mortgage without your spouse, or if you’re just wondering why in the world someone would do this, I’ve got a few answers. I spoke with Lindsay Villasenor, a Quicken Loans operations director, to get some insight on what happens when only one spouse is on a mortgage. If you’re married and you’re taking the plunge into the real estate market, here’s what you should know about buying a house with only one spouse on the loan.

Why Would You Buy a House Without Your Spouse?

There are a couple of reasons why you might leave your spouse off the mortgage. Let’s take a look.

One Spouse Has a Low Credit Score

Unfortunately, mortgage companies won’t simply use the highest credit score between the two of you, or even the average of your scores; they’ll pay the most attention to the lowest credit score. So if your spouse has a credit score that would prevent you from getting the best possible rates, you might consider leaving your spouse off the mortgage – unless you need your spouse’s income to qualify for a decent loan amount.

One Spouse’s Income Doesn’t Meet the Requirements

According to Lindsay, “2/2/2 is a general rule for all documentation requirements.” This simply means that you’ll need two years of W2s, two years of tax returns and two months of bank statements. Depending on your situation, more documentation may be required. Conversely, less documentation may be required depending on the type of loan you’re getting, but you should be prepared with these documents just in case.

Now if one spouse doesn’t meet these requirements – say this spouse doesn’t have two years of W2s – then it might make sense to leave this spouse off the mortgage. If your spouse is self-employed, he or she will usually need two years of business returns (although this may vary depending on the loan type and the structure of the business). If your spouse is unable to provide this documentation, for instance if he or she has only been in business for a year, then it may make sense to leave this spouse off the loan.

Things to Know About Leaving Your Spouse Off the Mortgage

If you’re the only one on the mortgage, the underwriter will only look at your stuff, right? It’s not always that simple. Here are a few things to know if you’re getting a mortgage without your spouse.

You Will Probably Qualify for a Smaller Loan Amount

If you’re part of a two-income household, getting a mortgage with both spouses usually means you’ll qualify for a bigger home loan. However, if your spouse isn’t on the loan with you, your lender won’t consider your spouse’s income.  Therefore, you’ll probably have to settle for a smaller, less expensive home.

The exception to this would be loans that take into account the income of household members whether or not they’re on the loan. An example of this would be rural development loans from the USDA where your income has to fall below a certain level. Quicken Loans doesn’t do USDA loans.

Joint Bank Accounts Are Just Fine

So what if you’re only using one income to qualify, but you have a joint bank account with your spouse? According to Lindsay, this doesn’t really impact underwriting.

“As long as our client is on the account and it’s a joint account, it’s determined that they are both legally allowed to access all of the funds,” says Lindsay. As long as you’re on the account, it’s your money and it won’t pose any problems for your home loan.

Your Mortgage Company May Look at Your Spouse’s Debt

When your mortgage company approves you for a loan, they look at your debt-to-income (DTI) ratio, which is the percentage of your gross income that goes toward debt. Your DTI can have a huge impact on your home loan.

If one spouse has a lot of debt, you might consider leaving them off the mortgage to decrease your DTI ratio. However, if the home is in a community property state and you’re getting a FHA or VA loan, both spouses’ debts will be taken into consideration.

So what’s a community property state? In a community property state, all assets and all debt belong to both spouses. Says Lindsay, “The phrase, ‘What’s yours is mine and what’s mine is yours’ is actual law in these states.” There are currently nine community property states: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin. If you live in one of these states and you’re getting a FHA or VA loan, your mortgage company will look at the debts of both spouses.

Well, there you have it. Are you and your spouse considering a one-spouse mortgage? Speak with a home loan expert or leave your questions in the comments section below!

 

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This Post Has 351 Comments

  1. I currently live in Kentucky. I have a 780 credit score and my spouses credit is 560. I qualify for a mortgage on my own. We share a joint bank account and file taxes together. Would I be able to purchase ahouse on my own without having to include my spouse on the mortgage. My spouse has some collections on her credit.

    1. Hi Brian:

      You can definitely apply for a house on your own without your spouse. I’m going to refer you to one of our Home Loan Experts because you mentioned having a shared bank account so I want them to be able to give you the most accurate information. Someone will be reaching out.

      Thanks,
      Kevin Graham

  2. My husband owns his own business, has been in business going on 2 yrs. I am an employee of the business and collect a W2 but I am not an owner. Could I still get approved (leaving his name off of the mortgage) using that income without having the added complication of him being the business owner? How would I approach a lender? Am I upfront about being married to the owner?

    1. Hi Mandy:

      I’m not sure about the part about being married to the owner, but I’m going to have someone reach out to you about this. I can tell you that if you’re the only one on the loan, you cannot use any of his income toward qualification for the mortgage. Someone will be in touch with more info than I can provide.

      Thanks,
      Kevin Graham

  3. My fiance and I are hoping to buy a home soon. My credit score is a 741, and his credit score is a 644. He did have a school loan turned into collections, but we are in the process of repaying that. His income is double what mine is, and we have a joint bank account now (recently joined bank accounts in the last 2 months). Will his school loan that is now in repayment hurt us when qualifying for a loan? If so, would we be able to only put my name on the mortgage using my credit score but using both of our incomes?

    1. Hi Jessie:

      I can tell you that your credit scores are in decent shape. As for the effect of the school loan, I’m going to pass this to someone who can go into more depth with you and help you determine the best course of action in your situation. They’ll be reaching out.

      Thanks,
      Kevin Graham

  4. My wife and i have a business we operate as sole proprietors gross income $300,000.00
    My credit score is 590 , hers is 700, we want to get mortgage in her name only. For mortgage purposes will half the business income be counted toward her getting a mortgage

    1. Hi Kenneth:

      I’m going to have someone reach out and get you a definitive answer here. I don’t know enough about business structures and mortgage approvals to answer here, but someone will be in contact.

      Thanks,
      Kevin

  5. I’m 26 yrs old, single. My dad and I are planning on getting a housing loan from USDA here in Guam. Let’s say for instance we got approved but then after few months to a year I got married to a military man. (after few years) If my husband and I decides to get our own housing on VA loan, is it going to be hard for us to get approved given the fact that I still have a USDA housing mortgage with my dad?

    1. Hi Loraine:

      I can tell you that if you’re making payments on the house with your dad and on the VA loan at the same time, it all counts toward your debt-to-income ratio. Your DTI can only be so high in order to get a mortgage approval, but it depends on type of loan you’re getting. I don’t want to tell you anything too specific about those ratios right now, because that could change a couple of years down the line and different mortgage companies have different policies.

      Thanks,
      Kevin Graham

  6. Hello,
    My husband is trying to obtain either a HElOC or a home improvement loan but he is self employed and has no verifiable income documents. I am full time employed. His credit score is 740+ and a good amount of savings and mine is bad. I’m working on it and have very little saved up. All of this is due to caring for my parents and my own illness. Could the bank use my income with his good credit or will they straight out say no because of my credit score. We are trying to figure out the best course of action. We want to repair the home but where he is strong I am weak and vice versa. Thank you.

  7. My husband and I are trying buy a house and the mortgage person ran my credit and is saying that I have things on my credit report that need to be taken care of first even though my name wont be on there. I didn’t think that was supposed to happen. Oh I live in las vegas. Any info would be great.

    1. Hi Robin:

      Unfortunately, because Nevada is a community property state your debts must be counted toward your husbands debt-to-income ratio. What they don’t look at is your score. We have more information on this topic in this post. I wish I could give you better news.

      Thanks,
      Kevin Graham

  8. My wife recently started working and does not meet “2/2/2” rule. I’m planning to keep her off mortgage, but will add on title. My question – if I anything happens to me before mortgage is paid-off, what is my spouse’s liability? Does she has to vacate house? What other re-course she has to keep house?

    1. Hi Vin:

      I’m going to have someone reach out to you to go over all the options, but in the event something should happen to you, she has the option to continue making payments as your spouse regardless of whether she is on the mortgage.

      Thanks,
      Kevin Graham

  9. The only thing holding me back is the fact that my husband and I are separated. He is unemployed right now due to a bad car accident that occurred in 2014. Also his scores are not good. I have been working on mine and finally got them to where they need to be. My question is: Can I get a home without him? Not quite ready for a divorce just yet however I would like to buy a home. What are my options!!????

    1. Hi Monique:

      The dynamics around this being the right time for you may depend on what state you’re in as there are community property laws, but I’m going to pass this along to someone who will be able to look further into your situation.

      Thanks,
      Kevin Graham

    1. Hi Jeannie:

      Since Texas is a community property state, I’m going to have someone reach out to help look into your options. They’ll be in contact.

      Thanks,
      Kevin Graham

  10. Wife part time post natal nurse 720 score with a bankruptcy six years ago. She makes approximately $2,000 before taxes per month.

    We have six children and two dogs living in a tiny three bedroom home in Virginia.

    I myself had my bankruptcy charged off at the end of March 2016. Finally, filed last fall due to a previous
    divorce. Credit score was 566 on Transunion and Equifax, but in the last 30 days Equifax has risen to 638.
    I am a permanently disabled veteran/unemployable veteran. My take home is $5320 between social security and VA benefits, which are tax free of course.

    How should we proceed in applying for a loan? Together? Alone?

    1. Hi Robert:

      Your bankruptcy might complicate things, but I can have a Home Loan Expert reach out and determine the what options might be available to you. They’ll be in touch. Thanks for reaching out!

      Kevin Graham

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