Buying a House Solo vs. Together: What You Need to Know
When it comes to buying a home, one of the first decisions you’ll make is whether to go solo or team up with a partner. Both routes have their own benefits and challenges, especially when it comes to securing a mortgage. Let’s break it down so you can make an informed choice!
Buying Together: Double the Power
Buying a home with a partner means you get to pool your financial resources, which can significantly boost your purchasing power. Lenders will take both of your incomes into account when determining how much house you can afford.
Example:
- Partner A: $70k
- Partner B: $80k
- Total Combined Income: $150k
Having a combined income like this increases your chances of qualifying for a higher mortgage. But keep in mind, when you buy together, you’re also sharing responsibility for the loan, including monthly debts.
Debt Considerations
When applying for a mortgage together, the lender will consider all of your monthly debts—yes, even your partner’s student loans, credit card balances, and car payments. This can impact your debt-to-income (DTI) ratio, potentially reducing how much home you can afford.
Buying Solo: All on Your Shoulders
On the flip side, if you’re buying a house solo, the financial responsibility is all yours. Only your income and debts are factored into the lender’s decision-making process. This means less purchasing power compared to a joint mortgage, but it also gives you full control of the process.
Debt Considerations
As a solo buyer, only your debts (student loans, credit cards, etc.) matter when calculating your DTI ratio. If you’ve been diligent about paying down debt, this can be an advantage because the lender will have fewer liabilities to factor in.
The Credit Score Factor
This is where things can get a bit tricky. When you’re buying with a partner, lenders will use the lower credit score between the two of you to determine your mortgage rate and approval. So, if one of you has a significantly lower score, it could impact your chances of getting the best deal.
However, if you’re buying solo, only your credit score matters. This is a great advantage if your score is high, but it also means you can’t rely on a partner’s credit to help you qualify.
💡 Pro Tip: If your partner has a lower score but you can still qualify on your own, some states allow you to put only one person on the mortgage while both names are on the title. This can be a good compromise if one of you is more financially stable.
Marriage and Mortgages
You might be wondering whether your marital status plays a role in mortgage approval. The short answer is: no, it doesn’t. Whether you’re married or not, the lender will look at your combined financials (if you’re applying together) or your individual finances (if you’re applying solo).
However, there are legal protections for married couples in the event that things don’t work out. In many states, being married provides more protection if you need to divide assets, which could be an important consideration for some couples.
Which Option is Right for You?
The decision to buy a home solo or together is a deeply personal one, and it depends on your individual financial situation and long-term goals. Buying with a partner can offer more buying power and flexibility, while buying solo can offer full control and fewer complexities when it comes to credit and debt.
If you’re not sure which route to take, it’s always a good idea to talk to a mortgage advisor who can walk you through your options and help you find the best path forward.
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