How to setup proper mortgage

 My fiance is currently staying with me, but is about to get a house. I wanted to know whether I should sign with her or not (I can't tell if my signing would help or hurt her). We both have great FICO's (high 700's), and good cash reserves (she has ~ $11,000 , and I have ~ $7,000). However, I am recently unemployed, and she is working full time (she's been at the same job for 3 or 4 years).
 Would me being on the title/mortgage help or hurt her? I have a good FICO, but no income, and have expenses ({mostly} paid by my parents). Would it help her more if I gave my money to her, then she signed herself? In that case, She'd have her ~ $1,800/mo income ([u]after[/u] taxes), her high 700's FICO, and $18,000 in her hands. She wants to be approved for the highest amounth possible, aiming to pay as little down as possible, with the smallest monthly payments possible (probably an ARM or interest-only; within a couple years our annual income is expected to be [u]way[/u] higher.
 Any opinions or ideas are greatly appreciated!

(Oh, we’re in Georgia, if that matters.)

Without a job your debt will only hurt the loan application. If you will be paying for part of the house then have her on the loan application only, and then after closing just add yourself to the title using a warranty deed. The lender is going to use her pre-tax income to qualify for the home so that will help you qualify for a bit more house. I am guessing that she makes about 25K per year. Is that correct? So her pre-tax income should be around 2500 a month. If her score are as high as you say they are she should easily qualify for an 80/20, a 75/25, or FHA with no problems. As for the lowest payment you will need to look at the numbers provided by your broker.

Chris has covered the bases from a financing standpoint, so I am going to take the Dr. Phil approach…

You must love her unconditionally if you are willing to give your cash reserves without the security of being on the deed…

Just be advised that if your relationship should go awry, you have legal recourse to recouping the down payment. LESSON: Speak to a lawyer to that you can structure a variation of a tenant in common agreement.

I assume that you intend to share in the monthly mortgage payments and upkeep as well? Again, with no agreement in place, you could help your girlfriend accumulate equity before only to be kicked to the curb…LESSON: If you are going to partner in the downpayment and partner in the ongoing maintenance and monthly repayment, make sure you partner in the equity appreciation as well.

This could prove to be a test to your relationship…if she agrees to be partners in both cost and profit and on paper; you got yourself a keeper!

We’ll be back after a few words from our sponsors…


Scott Miller

P.S. If you girlfriend had posted the same message, I would have given her the same advice (but from more of a Venus prospective and less of a Mars one…)

Also if she doesnt make enough to cover the monthly payment your probaly better off holding out on buying a home now and trying to get a job.I would say that after you got a job and made an acceptable amount of income then go and get a house with her.But be carefull because i was there before and my ex and me split up and she got the place because my name was no where on the property anywhere.So from one man to another sit back and think before you make a big move like this.It doesnt hurt to save your money so you have a bigger down payment and lower monthly payments