Buying A House Without Your Spouse
Interested in buying a house without your spouse? That could mean a couple of different things:
- You want to leave your spouse off the mortgage.
- You want to be the sole owner of your house (i.e., you want to leave your spouse off the title).
Both of these scenarios are possible, depending on where you live. Let’s look at why you’d buy a house without your spouse and how it might affect your home and mortgage.
Common-Law Vs. Community Property States
If you’re married, whether you can buy a house without your spouse comes down to whether you live in a community property or common-law state.
Community Property States
If you and your spouse live in a community property state, this means that all the assets you gain during marriage are owned by both of you.
These nine states are community property states:
- New Mexico
If you’re in a community property state and you want to leave your spouse off the mortgage, you can do that. However, if you’re applying for an FHA or VA loan, the lender will have to consider your spouse’s debts when you apply for the loan.
This scenario might be problematic if your spouse has a lot of debt. Their debts will increase your debt-to-income ratio (DTI) – especially since they won’t be adding any income to the picture if they’re not on the loan. However, if you’re keeping your spouse off the loan because of a low credit score, then applying solo might still be the way to go.
If you live in a community property state and you’re trying to buy a home but leave your spouse off the title, you won’t be able to do that. If you’re buying the home while you’re married, then your spouse will own 50% of the home.
If you don’t live in a community property state, you live in a common-law state. This means that you’re not required to share ownership of property you acquire while you’re married.
In a common-law state, you can apply for a mortgage without your spouse. Your lender won’t be able to consider your spouse’s financial circumstances or credit while determining your eligibility.
You can also put only your name on the title. If you and your partner were to split up, the home would be yours alone; you wouldn’t have to split it with your spouse.
Can I Keep My Spouse’s Name Off The Title?
If you live in a common-law state, you can keep your spouse’s name off the title – the document that says who owns the property.
The title doesn’t have much to do with the mortgage. The names on the mortgage show who’s responsible for paying back the loan, while the title shows who owns the property. You can put your spouse on the title without putting them on the mortgage; this would mean that they share ownership of the home but aren’t legally responsible for making mortgage payments.
Why You’d Leave Your Spouse Off The Title
There are a few reasons it might make sense to leave your spouse off the title:
- Separate finances: If you’re buying the house with money you had before the marriage, keeping your spouse off the title is one way to keep your finances separate.
- Estate planning: If you have sole ownership of the property, you can leave it to whoever you want. This might make sense if you have children from a previous marriage, for example.
- Protecting your assets: Does your spouse have a poor credit history? If your partner has defaulted on loans in the past, leaving them off the title could help you protect your home. This would prevent any previous lenders who have judgments against your spouse from taking the home as collateral.
If you leave your spouse’s name off the title of your house and want to add it later, you can do so through a quitclaim deed. A quitclaim deed lets you transfer property interest from one individual to another.
Reasons you might get a quitclaim deed include
- Adding your spouse to the title
- Removing your spouse from the title, typically after divorce
- Passing property to a family member, such as a child
- Putting property into a family trust
Can I Keep My Spouse’s Name Off The Mortgage?
Whether you live in a community property or common-law state, you have the option to leave your spouse off the mortgage. Let’s take a look at some reasons it might make sense to apply for the mortgage alone.
Your Credit Scores
Lenders want to make sure they’re lending to people who can repay what they borrow. When you apply for a mortgage with your spouse, lenders look at the lowest credit score between the two of you; being married doesn’t mean they’ll average the scores.
If your spouse’s credit score is low, it could cause a few problems. First, it could prevent you from getting the loan at all. Most lenders look for scores of at least 580, so a credit score below that could keep you from qualifying.
Second, your spouse’s low credit score could prevent you from getting the best interest rate. The higher the credit score, the more likely you are to get a better interest rate. If your spouse’s credit score is significantly lower than yours, you may want to consider leaving your spouse off the loan to make sure you can get the best loan terms possible.
When you fill out a mortgage application, you’ll be asked to prove your source of income. In most cases, this means providing things like pay stubs and W-2s. If your spouse is newly self-employed or hasn’t had a stable source for income the last two years, they might have a difficult time qualifying for a loan.
If your spouse can’t prove income, there’s not much benefit to having them on the loan. If they lack provable income but have debt, they may throw off your debt-to-income ratio, which could keep you from qualifying.
Joint Bank Accounts
When you apply for a mortgage, you need to show that you have enough funds to cover things like your down payment and closing costs. If you apply for the loan without your spouse, you won’t be able to use assets that are in your spouse’s name only to apply for the loan.
But what about joint accounts? If you have a joint bank account with your spouse but choose to buy without him or her, you can still use the account. It won’t pose a problem that the account is jointly owned by someone who’s not on the loan. As long as you have access to the money, you’ll be able to use it when applying for a mortgage.
There are many reasons why leaving your spouse off your mortgage or title could be the right choice for you. Applying for a loan without your spouse could help you get the best loan terms, and there might be a benefit to being the only one on the title as well.
If you have specific questions about how any of this might impact your personal situation, we recommend consulting a real estate attorney. When you’re ready to apply, just fill out your online application on Rocket Mortgage®.
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