 TITLE: Can I Buy a House If My Spouse Has Bad Credit? CONTENT: Joint vs. Single Applicant: Decide How to Apply\n-----------------------------------------------\nWhen you're applying for a mortgage with a significant other, you have the option to apply either individually as a single applicant or together as joint applicants. Why would you want to leave your spouse off the application? Lenders don't just average out your two credit scores or go with the highest one when evaluating your creditworthiness as a pair—they pay the most attention to the lowest credit score. If your credit is great but your spouse's isn't so hot, a joint mortgage application could be denied.\nLenders also look at your debt-to-income ratio (DTI), which compares the total amount you owe each month with how much you earn, when determining your eligibility for a mortgage. If your spouse has a significant amount of debt as compared with income and they're applying for the mortgage along with you, it might be denied. Even if your joint mortgage application is approved, your loved one's poor credit or high DTI could land you with a higher interest rate than if you'd applied alone. With a loan as large and as long as a mortgage, a higher interest rate can cost you tens of thousands of dollars or more over the life of the loan.\nHere's an example of how much of an impact your annual percentage rate (APR) can make. Say you're taking out a mortgage loan for $175,000. You have great credit so you apply by yourself, and you score an interest rate on a 30-year mortgage of 4%. If you take the full 30 years to pay it off, you'll spend $300,773 over the life of the loan. Now let's say you apply jointly with your spouse, who has less-than-stellar credit, and you get a higher interest rate of 4.5%. You'd pay $319,212 over the life of the loan—a difference of nearly $20,000.\nHowever, there's another factor to consider: Your income is analyzed by lenders as a way to determine whether you can afford repayments. If you have a high income or are the primary or only breadwinner, that might not be a problem. But if not, it might be worth the risk of including your partner on the application if you need their income to qualify for the loan. END