Can I Get an FHA Loan Without My Spouse?
There are many instances when a home buyer will want to purchase a home with his or her spouse, but leave the spouse off of the mortgage. The FHA guidelines have specific rules regarding non-applicant spouses and whether the spouse must be on the mortgage and/or the deed for the property. This article answers the question “can I get an FHA loan without my spouse”.
Can I get an FHA Loan Without My Spouse?
FHA guidelines require the FHA lender to consider the monthly obligations of a non-applicant spouse into the qualifying ratio calculations. However, the credit scores of the non-applicant spouse (good or bad) will not be a factor in the loan application.
There are Reasons to Leave Your Spouse Off the Mortgage
Some people have very specific reasons to leave their spouse off of the mortgage. These are just a few of the most popular examples that we have seen over the years.
- The spouse has poor credit
- The spouse does not work and cannot contribute income to the loan application
- You want to keep the future mortgage payment and debt off your spouse’s credit report
- You want to keep the home or asset in just your name for legal purposes
It is not uncommon for one spouse to hold the mortgage for their primary residence while the other spouse takes on other debt such as car payments.
*Very important to note is if you plan to leave your spouse off of the FHA loan application, your spouse’s income cannot be used to qualify either. Therefore, your income level must be enough to qualify for the mortgage and to carry his or her debt as well.
Why is the signature of my spouse required?
The spouse’s signature is to acknowledge that his or her partner is taking out a mortgage on a primary residence. This is done to protect the non-applicant spouse from an unexpected mortgage payment.
Even with non-FHA loans, many states require a signature from a non-applicant spouse for refinances. There is a history of one spouse refinancing the home and cashing money out without the other spouse knowing. This is especially true leading up to a divorce.
Does the FHA need to consider my spouse’s credit if I am getting divorced?
If you are still married legally, then you must follow the FHA guidelines on non-applicant spouses. If you are getting divorced and do not want to involve your spouse, then you must wait until after your divorce before applying for an FHA loan.
What if I am engaged and not married yet?
If you are engaged, the FHA lender will not be required to include the credit or monthly obligations of your fiancé.
Can my spouse be on the mortgage but not on the title?
The FHA guidelines are clear that if a spouse is on the mortgage, then they must be on the title. Therefore, if you prefer to have just one name on the title, then you will need to have just one on the mortgage as well.
What if I live in a community property state?
In a community property state, married couples share all debt and assets. Therefore, law would require the lender to include the non-applicant debt even if the FHA guidelines did not require it. These 9 states are considered community property states:
- New Mexico
How Can I get an FHA Loan if My Spouse Has Bad Credit?
We outlined above that your spouse’s credit will not be factored into the FHA loan if you apply for the mortgage on your own. However, the non-applicant spouse will be used for the qualifying ratios.
However, if you planned to finance your new home with a conventional mortgage (not FHA), then the lender will not be permitted to look at your spouse’s credit report or factor in the debt that may appear on that report.
Will my spouse’s credit hurt my chances of qualifying for an FHA loan?
Your spouse’s credit scores and credit history cannot result in a loan denial if your spouse is not going to be on the mortgage. However, if your spouse has a lot of additional debt that is not also on your credit report, then that additional debt can potentially lead to a loan denial if your DTI is too high.