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Quick scenario: My husband had two rental properties prior to our marriage. Since then, one has foreclosed. He also purchased the home we currently live in (prior to our marriage). We are behind on payments in our current home and plan to short sell the home. Meanwhile, I applied for an QUALIFIED for a mortgage. (Our plan is to move into a new home -- a much more affordable home.) It's down to the wire, and my loan has not yet been officially approved BECAUSE of my husband's rentals, foreclosure, late payments on current home. I totally get that on paper it looks like we are a bunch of losers, but truly is not the case. We (my husband) had bad luck with his rentals, was laid off during this time, etc. We are really trying to make a smart choice for our family (we have two young girls) and downsizing into something more within our budget. Anyway, bottom line, if I qualify for this new home on my own -- can my husband's problems be used against me!? I am not on the mortgage or title for any of the homes he owns! I'm desparately looking for advice on this.....
I'm not in the lending industry, so not sure about this, but I believe the answer is that it depends on what type of loan you are trying to get, whether your state is a community property state, and various other factors, and the only person who can tell you for sure is your lender.
I know when I bought my home, I was married, but I qualified on my own, because my husband's debt to income ratio was bad, and his credit wasn't great. So they used only my credit and my income, and only my name is on the deed. But that was 10 years ago, and the rules have change a LOT since then.
Yes, it depends on the type of loan. If it's a government loan like FHA or VA, your husband will be looked at. And not being on the title of the homes doesn't really matter if you live in a community property state.
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