Tips for Discussing a Mortgage with Your Spouse
If you’re applying for a mortgage with your spouse for the first time, a number of important financial discussions can come up that are potentially complicated to navigate. Understanding the elements that you’re going to need to be comfortable talking about and potentially exploring in detail with your partner – especially if you haven’t had in-depth financial conversations before – is important. Here’s a closer look at what topics should be openly talked over before the application process to avoid any surprises.
How much you make at your job, individually and in terms of a combined household income, plays a role in how much house you can afford. Have you had an open discussion with your partner or spouse that includes how much you make, what deductions you get, and what your take-home pay is each pay period? Understanding how much income you have to work with is an essential component of determining which properties you should consider.
Do you have debts such as student loans, a car payment, and unpaid credit card balances? If so, a portion of your income each month will be dedicated to paying off these debts. These facts are relevant even beyond that. Financial institutions consider your debt to income ratio when approving mortgages. Even if you have good credit, high levels of debt could lead to an application denial. Determine your combined debt levels and whether those need to be addressed before you start the application process.
Your credit score is a composite of your total past credit activity. Scores range from 350 to 850. The higher your score, the better your credit. Higher credit scores increase your chance of getting a financing application approved and also have an impact on your interest rate. When two people are buying a house together, one low score can have a big effect on the mortgage rate offered.
Past credit problems
If your credit score is lower than ideal, chances are that there are specific problems that contributed to the issue. Whether it was a job loss or medical issue or simply poor spending habits, be clear with your spouse on the situation. Did you declare bankruptcy, have a house go into foreclosure, or have accounts go into collections? These situations can impact your ability to get a mortgage at all, or significantly increase the interest rate. Good communication with your spouse and with your bank can help clarify past credit problems and show the steps that have been taken to rebuild can improve your chances of successful funding.
Are you ready to apply for a mortgage in Las Vegas? Contact Sydnee Johnson today to discuss your financial situation and learn more about your mortgage and financing options.