 TITLE: Can My Spouse Ruin My Credit? CONTENT: Can You Buy a House if Your Spouse Has Bad Credit?\n--------------------------------------------------\nLike many couples, you may hope to purchase a home soon after your nuptials. If your credit is good and your income is sufficient to qualify for a mortgage, you can buy the property on your own and bypass the problems associated with a spouse who has bad credit.\nOn the other hand, if you need your spouse's income to qualify for the loan, or don't want to be the only one carrying the debt burden, his or her credit will be a factor. Unfortunately, your great credit won't neutralize the other applicant's subpar credit scores. That's because lenders don't average your two credit scores together to get a midpoint, but will focus on the lower credit score.\nMortgage lenders also check debt-to-income ratio (DTI), which is the total of your monthly debt obligations compared with your monthly earnings. If too much of your spouse's income is dedicated to paying off debt, the interest rate that's attached to the loan may be sky high—or the loan might be denied altogether.\nThankfully there are options to offset these dilemmas:\n*   **Shop around for a lender.** Credit unions tend to be flexible with members who have troubled credit histories. Online and community banks are also worth exploring.\n*   **Look into first-time homebuyer programs.** FHA loans andFannie Mae's HomeReady Mortgage may accept borrowers with low credit scores.\n*   **Offer a large down payment.** Putting extra money down will reduce the lender's risk, so that can compensate for less than desirable credit scores.\n*   **Start high, then go low.** If the only mortgage you can get has a high interest rate, you can accept it now and then refinance when your spouse's credit improves.\n*   **Ask someone else to cosign.** If a relative with great credit is willing to be on the title, this can be your way in. Depending on the circumstances, it's possible to have that person's name removed from the mortgage after you've established a lengthy and positive relationship with the lender. END