All of us desire to own a house of your own. But sadly, for many the reality brings us down from the heights of fancy to the empty pockets and fluctuating bank balance. Yet, banks are always there for a home loan or mortgage. However, this option is not that easy and not everyone can avail it willy-nilly. Here are some of the issues people face before applying for the mortgage.
Here is how your marital status affects your mortgage approval and payment prospects:
How do you qualify for and repay the mortgage when you are single?
Cutting some corners might be of great help. Work on daily expenses and abstain from any extravagant habits to increase savings. You need to assure the lender that your savings with your moderate income will enable you to repay the loan. Ideally, try to make a down payment of 20 percent to 30 percent. Obviously, the lesser the loan, the lesser interest you have to pay and hence save a lot of money in the long run.
How do you qualify for and repay the mortgage when you are engaged?
Consider of each other’s savings and income. You can consider setting up a joint bank account, which will help you to pay the mortgage, maintenance, and the property taxes. Be careful in the selection of your price range for the house, for if the relationship turns sour later, the person who signed the mortgage bond will bear the sole responsibility of clearing the debt.
Of course, there is always an option to choose a joint mortgage which is better for both of you and your relationship. Lastly, choose the title ownership with utmost care for splitting the mortgage and property is a massive issue when it comes to separation.
How do you qualify for and repay the Mortgage when you are married?
Check out each other’s credit score before applying. A bad credit score might render you inapplicable as a borrower. Married couples are expected to apply as one single unit and are, therefore, both liable for the payment of the deed. Interestingly, if both the partners have a decent level of income, you can afford a large mortgage together.
How do you qualify for and pay the Mortgage when you are divorced?
Even if you are divorced, you are still seen as a single unit in the eyes of the lender. However, you are both entitled to repay the loan. You can buy your partner’s share and set out a new bond in your name which will make you the sole owner of the property and likewise for your ex (or might be ex).
Certain protocols and standardized rules must be followed to obtain a loan, including rigid investigations by the bank of your income and bank account information to ensure that you are worthy of availing the mortgage. Your financial status as a single or joint income holders plays a great role in qualifying for the home loan and your capacity to repay the loan.