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My husband and I want to purchase a new build home here in Phoenix. We own a business and give ourselves a paycheck. The paycheck as of Jan 2013 will be in my name. I have no debt in my name it is all in his and I have the better credit score. He has current late payments on a home we own in Florida that we r trying to get refied. So I thought since the debt is not in my name and the income comes to me that I could buy the home on my own. I need to do a FHA bc I had a foreclosure just over 3 yrs ago so I cant do a conventional loan bc it has to be 7 years behind me instead of 3. But when I went to the new home builder they pretty much said short of getting a divorce I would be able to do it bc with an FHA we would both have to be on it and since I cant do a conventional that Im pretty much out of luck. Does anyone else have maybe another option that isnt being looked at here? Isnt there anyway to just do it on my own without having to get a divorce? lol Seems kind of ridiculous. I appreciate your help. Thanks
If your income, credit report, funds in bank, etc meet the requirement you can put an FHA loan in only your name and not worry about your spouse.
This is not true in Texas, to an extent. Yes, the loan can be in only one spouses' name, but because it's a government loan, they look at both spouses for all debt and credit issues. This OP has had a foreclosure plus current lates on a current mortgage. You bet FHA is going to look at both of them to weigh their risk even if the loan is done in just one name.
Arizona is a community property state which is why I think it is done that way here. Where in other states that arent CP states it can be done the way I need. But im just hoping there is a way around this here?
This is not true in Texas, to an extent. Yes, the loan can be in only one spouses' name, but because it's a government loan, they look at both spouses for all debt and credit issues. This OP has had a foreclosure plus current lates on a current mortgage. You bet FHA is going to look at both of them to weigh their risk even if the loan is done in just one name.
I guess it would depend on the state then, but I know in NY this is not an issue.
You should be able to do it on your own. We were recently in this same situation and just one of us was going to apply and were told it's not a problem. Ended up putting both of us on the loan becuase income from one person wasn't enough but initially it didn't seem to be a problem just appying with one person. They did have to pull both people's credit though, said it was FHA regulation. I don't know how debt is calculated since AZ is a community property state.
One other thing that caught my attention though, you said starting in Jan 2013 the paycheck will be just in your name? I assume you are both self employed and work for the same company? It won't matter who gets paid now, what will matter is who was paid in the past 2 years. So if in 2011 and 2012 you each had 50% of the income, that is what they are going to look at.
Yes we are both self employed and the past yr he took the paycheck and now into our second year I will be the one taking the paycheck and not him.
Like I mentioned earlier, being self employed, they will look at your last two years of tax returns to determine your income...it really doesn't matter how much you make now (though they will want to see a up to date profit and loss statement prior to closing to make sure the company is still making money).
If he took all the paychecks last year and you didn't take any, then it will look like you were not employed and he would have to be on the loan as well. Did you also take draws/dividends or do you do pay yourselves only salary? What kind of company structure do you have setup (Corp/LLC/etc)?
Also as was mentioned on Zillow, being in AZ, they will also figure his monthly debt into the debt-to-income ratio. They don't have to have him on the loan and his credit won't matter, but his monthly debt will have an impact.
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