First-time homebuyer programs have flexible qualifying guidelines to make buying your first home possible. The definition of "first-time homebuyer" can vary, but program providers typically use the Department of Housing and Urban Development's definition. First-time homebuyers have not held an ownership interest in a property in the last three years, including a residence owned by a spouse. You have to meet certain criteria to buy as a first-timer if your wife currently owns a home.
TL;DR (Too Long; Didn't Read)
If you don't currently own any home and have not held ownership interest within the last three years, you may qualify as a first-time home buyer. However, there are other conditions to be aware of.
HUD's Definition of First-Time Homebuyer
HUD allows you to qualify as a first-time homebuyer even if your wife currently owns a primary residence; however, you cannot currently own that home or any other primary residence with her. You may not have your name on the title of any home used as your primary residence within the past three years. This three-year countdown begins upon selling or otherwise removing your name from any primary residence's title and prevents you from closing escrow any sooner than three years from that date. The three-year rule is used by lenders and government-assistance programs to prevent investors from using first-time homebuyer programs.
Multiple Conditions Apply
You qualify for first-time homebuyer status if you have never owned a home before, even if your wife currently owns. HUD provides other conditions under which you may still meet the first-time homebuyer requirement. You may qualify as a first-time homebuyer if:
- You are a single parent who has only owned while married to an ex-spouse.
- You are a displaced homemaker or stay-at-home dad who has only owned with a spouse.
- You currently own or previously owned a mobile home.
- You currently own or previously owned a home not up to building code which could only be brought compliant by reconstructing the home.
Marital Status Matters
HUD's definition of first-time homebuyer helps separated and divorced husbands get back into a primary residence of their own. For example, a "displaced homemaker" separates from his wife, who keeps the marital home as a result of the legal separation. The displaced husband may qualify to buy a replacement primary residence as a first-time homebuyer. Likewise, a divorced husband whose wife keeps the marital home in the divorce can buy as a first-timer.
Proving your eligibility under either of these two conditions requires that you provide legal proof of separation or divorce to the mortgage lender or program provider. This includes a final separation agreement signed by a judge or a divorce decree. These documents outline the allocation of assets between exes, such as the marital home, as well as alimony or child support that you or your wife must pay.
Your Spouse's Consent
Your wife's consent is necessary when buying a home on your own with a first-time homebuyer program. Mortgage lenders and government providers of first-time homebuyer programs require your wife to sign off on her rights to the home you purchase. Since your wife is not part of the transaction for qualifying purposes, she must quit claim to the title of your new primary residence.
Because your wife will not be named on the title of the home and cannot stake a claim to the house, the mortgage lender also protects its interest in the property. The escrow or title company handling your purchase transaction can provide a quit claim deed for your wife to sign in front of a notary public. The legal document then gets recorded in your county along with the title deed.
Karina C. Hernandez is a real estate agent in San Diego with a background in mortgage origination. She has been licensed since 2004 and received a B.A. in English from UCLA. Karina has written on a variety of financial topics, including credit, real estate finance, insurance and taxes for online channels such as eHow, sfGate, the nest, Quicken, TurboTax, RE/Max, Zacks and Opposing Views.