Marriage and mortgage! If you are a newlywed and are looking to buy a home with your spouse, there are some guidelines, considerations, and general knowledge key points to know. If you are ready to kickstart the process today, contact a team member. Otherwise, taking the time to be informed will allow you to be comfortable and confident navigating the process.
When should newlyweds buy their first house?
There is not a single correct timeframe for when a newlywed couple should purchase their first house together; every situation and couple is unique. However, buying a house is one of the biggest investments you can make, so there are some baseline considerations you should discuss with your spouse.
First, you will need to consider and evaluate your finances. You must make sure you both meet the basic eligibility requirements for a home loan. A lender will evaluate the following when reviewing your mortgage application:
- Credit score
- Down payment funds
- Income
- Debt-to-income ratio
- Credit history
- Job history
Second, you should consider the home’s location. It is advised to stay in your house for at least two to five years in order to even out the costs of purchasing a home. Meaning, if you don’t want to lose money, you should plan on staying in the home for a longer time period considering closing costs and fees. If you don’t plan on living in your current location much longer, it may not be the best time to purchase a home.
If you feel confident that you are ready to buy a home with your spouse, there are a few things you can do right now to prepare:
- Complete this free homebuying course which will go through the eligibility and preparation process for the mortgage application!
- Download this homebuyer guide to ensure you check all the requirements before getting pre-approved for a home.
- Download the DML App and use the calculator feature to calculate your monthly mortgage payments based on your financial portfolio.
- Once you have completed the above and feel prepped, contact a team member today OR get pre-approved quickly and seamlessly through the DML App.
How does buying a house as a married couple work?
Buying a home as a couple means that your financial portfolios will both be considered when buying a home. Therefore, both of your incomes will be considered when applying for a mortgage which will increase the amount you are approved for. However, it also means that each applicant’s credit scores and debts will be considered. Depending on the situation, buying a home with your spouse could be beneficial, or not as much. Discuss the pros and cons of applying with a co-borrower (your spouse) with your lender.
In most cases, you will have a joint mortgage where both of your names are on the mortgage. The key is to have an honest conversation with your spouse regarding each other’s finances to decide what loan is best for you. Browse this page of Direct Mortgage Loans’ loan products and click on the description that fits your situation. Then, you will be able to see what loan is best for you.
Do married couples have to apply for a mortgage together?
Married couples usually apply for a mortgage together, however, it is not required. When you apply together, you can combine your resources to have greater purchasing power. However, if one spouse has a low credit score that could damage your purchasing power, you could decide to not apply together.
If you decide that you would like to apply together so that both of your names are on the application, but cannot qualify for a conventional home loan, a Non-QM loan may make homeownership possible for you. Read more about Non-QM loans.
Does a joint mortgage have to be 50/50?
You do not have to evenly split the share of the joint mortgage. Agreeing to share a joint mortgage with someone is a serious financial relationship with the other person. Analyze your finances to decide if another ratio besides 50:50 is best for both owners.
Homebuying Tips for Newlyweds
If you and your spouse are looking to buy a home, keep these tips in mind!
- Increase your credit score as much as you can. Here are some things you can do now to raise your credit score.
- Save additional money, outside of your down payment savings. You will need to account for closing costs, fees, and any home renovations and furniture the first year.
- Budget, budget, budget! Saving money is only half the battle. It is important to budget your income to be effective in where you spend your money. Consider this HIGHLY EFFECTIVE budget.
- Find the right agent and lender. You want to ensure you can trust your agent and lender so that you can stress less during the process.
- Do not rush the process. The right home for you will come so do not settle on something less. This is a huge investment, so it is important to treat it like one!
When it comes to buying a home with a spouse there are a lot of considerations, conversations, and preparations to be made. However, buying a home is a very lucrative investment in the long run. Take the time to gather knowledge and find a lender that you are confident in.
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