What impact does co-applicants credit score have on mortgage rate?

Question

My fiance are getting married in six months. We plan to buy a house together before the wedding.

My credit score is excellent (over 750). Hers is in the good range (around 650-700), but it's only because she has student loan debt...she's never missed a payment or been late.

I know I would get a very good interest rate and would qualify for the full amount if I applied for the loan without her on the application. If we applied as co-applicants, would I introduce the risk of us getting a higher interest rate because of her score being a little lower?

If that were the case, does anybody have any recommendations on whether it's possible to have me as the only name on the mortgage but be able to add her to the title at or after the close?
Thanks!

Answer 1

Congratuations on having good credit and being in a situation to get a mortgage based on your credit/income alone. The fact you can get a mortgage with or without your finacee signing puts you in a very unique situation. Usually most couples need both to sign to qualify for a mortgage.

That said, I absolutely recommend you contact a number of reputable mortgage lenders (ask your friends and family which lenders they've used and trust) and see what rates you are offered, with and without your fiancee. Then you can just pick the best the best one! What more could you ask for?

Honestly, based on the numbers you've stated, I think you are going to get the best rates anyway (with both on the mortgage), so I don't think you have to worry.

In regards to putting your fiancé on the mortgage after closing, in most cases you would have to refinance the mortgage in order for that to occur. And to add her to the deed but not the mortgage would require you to deal with your assessor's office (or county clerk) and you would probably want to get a lawyer to make sure it was done right... it would be a pain. I would not recommend that.

Just find a mortgage professional you trust and compare your options. I think you are going to find that you are in a win-win situation.

Answer 2

There's a strong likelihood that you'd get the best rates, with both of you on the loan.

If you aren't being offered rates that are roughly what you're seeing available (look at bankrate.com, add .25% to whatever their average is, since that's where rates are really at), then ask why, and ask them to try it with just you.

But if she's never missed a payment, I would find it surprising that it would impact it.

I regularly approve couples where one has 700+ scores, the other is in the 580-620 range, and they get the best rates.

Answer 3

Sounds almost identical to my situtation. Our broker told us that most banks only go off the lower of the 2 score these days. However, your broker will be able to find banks that will be more realistic and take into consideration the higher score as well. In your case i would not worry since BOTH of your scores are good enough to qualify.

Answer 4

Your score is high enough that it shouldn't hurt the rate. I can help! Just sgoot me an email to [e-mail], and we'll get rolling!

Marty

Answer 5

Just as much as Yours. those aren't scores that would cause much problems for you. They also look at your current income. try to emphasize your income to debt ratio,if its low that is important