If you learned all the ins and outs of getting a home mortgage when you were single, you’ll be glad to know that the process is largely the same now that you’re in wedded bliss. One difference, however, is that you now may obtain a home mortgage in both of your names or in one name only -- your own or your husband's.
Purchasing a Home in One Spouse's Name
Even as a married couple, you and your husband can decide to take out a mortgage in only one spouse’s name. Depending on your lender’s policies, if a single person is on the mortgage, you may still be able to put both of your names on the deed. Just keep in mind that, in many states, when the deed is in your husband’s name only, he will have complete ownership of the property. If this is the case, you won't necessarily have control over what happens to the property in the event of his death or any disputes.
If your credit is less than stellar but your husband's is excellent, it could be a smart move to get a home mortgage in his name only. The reason is that when you apply together both of your credit scores are taken into account by the mortgage lender. Even if your husband’s credit is nearly flawless, your low score will have a negative affect on your joint mortgage application. To ensure that they qualify and keep their mortgage rates as low as possible, many couples decide to leave off the lower score and apply for a mortgage in one person’s name only.
If only your husband's name is on the loan application, the mortgage lender will consider only his income, which is one of the major factors used to calculate the debt-to-income ratio, a number that determines how large a loan he can secure. If your income makes up a large portion of your joint earnings, it may be worth it to include your name on the mortgage application -- even at the risk of paying a higher interest rate.
Different Rules in Different States
Although every state allows lenders to approve a mortgage for just one person in the marriage, some states may require lenders to consider the amount of debt of both -- regardless of whether both names are on the mortgage. Even if that is the case in your state, however, the lender may not consider your credit score if your name isn’t on the application. Make sure you’re familiar with your state’s individual laws before making a decision about the best way to submit your mortgage application.
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