surtur Posted May 12, 2014 Share Posted May 12, 2014 So it is coming down to the time me and the family would like to stop renting and purchase our first home so i hope someone on here has some banking knowledge to share. My situation is this i have a good credit score not Excellent but currently 726 which according to Equifax is considered in just in the Very good category. the problem is the amount i make and my current debt situation ie car loan credit cards etc when added together drops the amount i can be approved for into the almost impossible to find a decent house range. So i would like to have my spouse as a co-applicant the problem is she has Zero credit history. does anyone know how much it would affect our chances of approval. We have lived in the same rental for 8 years never missed a payment. We both work full time i am on salary and she is hourly. We have a down payment saved up and i am currently working on paying down my credit cards. anyone have any input? Link to comment Share on other sites More sharing options...
inane Posted May 12, 2014 Share Posted May 12, 2014 Tip number one: Don't ask random strangers on the Internet. Go to a professional. Link to comment Share on other sites More sharing options...
Denguin Posted May 12, 2014 Share Posted May 12, 2014 Not exactly a wiz with the whole credit history thing, but I'm sure there's something you could explore with regards to getting credit as long as there is a guarantor of some sorts (i.e. parents). Have you tried exploring that, or is that a possibility for either of you? Link to comment Share on other sites More sharing options...
stoney Posted May 12, 2014 Share Posted May 12, 2014 Hey Surtur, It will definitely hurt you guys that she doesn't have any credit history - A lot of lenders won't consider applicants that don't have any, and those that do generally don't have as favorable interest rates. If you still have awhile before you would actually be buying a house, I would recommend having your wife get a credit card (from a bank or from a department store or something) and just using it to buy a few things a month and paying it off in full. Fairly quickly it will start reporting to equifax, and voila, she will have some credit history. That, along with you rent payments, and hopefully some bills like cellphones etc., should go a long way to convincing lenders to give you financing. Also, depending on your relationship with your bank, they may be willing to do something that they wouldn't do for any old joe, so that might be worth a try too. Source: I'm a mortgage broker =) Link to comment Share on other sites More sharing options...
surtur Posted May 12, 2014 Author Share Posted May 12, 2014 Tip number one: Don't ask random strangers on the Internet. Go to a professional. considering that my bank sucks at giving any kind of advice. i figured there might be someone on here that actually is a professional willing to help explain some things. considering there are law students, Lawyers etc on here should i not assume there might be someone in the banking industry also? figured it was worth a shot. plus probably much quicker then booking an appointment at the bank again (esp after not getting any answers the first time basically they just went online and used the same online tools i already used lol and couldn't answer my questions) Link to comment Share on other sites More sharing options...
surtur Posted May 13, 2014 Author Share Posted May 13, 2014 Hey Surtur, It will definitely hurt you guys that she doesn't have any credit history - A lot of lenders won't consider applicants that don't have any, and those that do generally don't have as favorable interest rates. If you still have awhile before you would actually be buying a house, I would recommend having your wife get a credit card (from a bank or from a department store or something) and just using it to buy a few things a month and paying it off in full. Fairly quickly it will start reporting to equifax, and voila, she will have some credit history. That, along with you rent payments, and hopefully some bills like cellphones etc., should go a long way to convincing lenders to give you financing. Also, depending on your relationship with your bank, they may be willing to do something that they wouldn't do for any old joe, so that might be worth a try too. Source: I'm a mortgage broker =) See inane there was someone on here that knows something lol. Thank you for the reply. Thing is how fast does credit build i was wanting to start looking at houses by August and when we checked her Credit history she had absolutely nothing on it. She has had a cellphone on monthly payments for almost a year never missed a payment but that doesn't even show on it? Basically she just had a credit card with her name but assigned to my account. we will try the secured credit card route for her because she can't even get accepted for a low amount with no credit history. Link to comment Share on other sites More sharing options...
Tearloch7 Posted May 13, 2014 Share Posted May 13, 2014 Best solution is have a 'household' credit card in your partners name .. use it to buy all household purchases and pay it off immediately .. in about a year she will be good as gold, and, you can get 2 to 3 % back on your card .. so several hundred dollars saved .. P.S. Is your spouse an 'impulse buyer'? .. if so, ignore every thing I have said .. please .. forget it now! Link to comment Share on other sites More sharing options...
elvis15 Posted May 13, 2014 Share Posted May 13, 2014 Tip number one: Don't ask random strangers on the Internet. Go to a professional. Yup, check with a good mortgage broker, or a bank you trust. My credit was good (but not fantastic) I couldn't have my wife co-sign but at least I had minimal debt and some RRSPs/stocks I'd been building up. The broker I saw got me into a good mortgage which I'll be due to re-up with next year on an apartment I could afford. A house might be tougher, but until you know what you'll qualify for at a rate you can afford, there's no point speculating. Hey Surtur, It will definitely hurt you guys that she doesn't have any credit history - A lot of lenders won't consider applicants that don't have any, and those that do generally don't have as favorable interest rates. If you still have awhile before you would actually be buying a house, I would recommend having your wife get a credit card (from a bank or from a department store or something) and just using it to buy a few things a month and paying it off in full. Fairly quickly it will start reporting to equifax, and voila, she will have some credit history. That, along with you rent payments, and hopefully some bills like cellphones etc., should go a long way to convincing lenders to give you financing. Also, depending on your relationship with your bank, they may be willing to do something that they wouldn't do for any old joe, so that might be worth a try too. Source: I'm a mortgage broker =) Well, there you go. Link to comment Share on other sites More sharing options...
diesel_3 Posted May 13, 2014 Share Posted May 13, 2014 I have purchased 2 houses, my experiences are as follows: 1st house was in Edmonton when the housing market sort of crashed and banks were giving out loans left and right, it definitely helped that I was military at the time and had 10% as a down payment from my deployment pay. 2nd house (currently living in) was a little different, I still own my property in Edmonton but an investment company assumed the mortgage so I don't make/owe anything on it, but it still shows up on my credit reports, anyways, I had just been employed by my current employer for about 6 months or so and they couldn't quite approve me for what I was looking for. I then added my fiancee (Who is hourly, like yours) even though she wasn't guaranteed hours, it still added an extra 200K on what we got approved for. So, they MAY ask you for MORE of a down payment then the standard 5%, but since you are a 1st time home buyer I believe 5% is only what is required, plus you can apply for a 1st time home buyers grant where you can get %'s of GST reimbursed and what not. But, I highly recommend adding your wife as a co-applicant and going to a mortgage broker. In my experience, the big banks were a little more picky, and both times I went through a broker, I ended up getting approved through banks in Toronto at really good interest rates. Anyways, that's my ramble! Link to comment Share on other sites More sharing options...
stoney Posted May 13, 2014 Share Posted May 13, 2014 It's hard to say how long it will take unfortunately - As Tearloch7 says, definitely within a year, but whether or not it would be improved in time for August, I don't know. Equifax is pretty secretive about what exactly they use for credit scores and time frames. If she currently has no credit history at all according to equifax, than I would doubt it will be up by August unfortunately, as it usually take 60 days for changes to show up on the credit report when you do have something already reporting. Doing the secured card thing is definitely the way to go, and Tearloch7's suggestion of using it for household purchases is a good one. Hopefully you'll only need a few months before things start to show up on her credit report. Link to comment Share on other sites More sharing options...
NucksCelts Posted May 13, 2014 Share Posted May 13, 2014 I am 22 and just bought my home back in january. The process was awful, as a 22 year old with good credit and a good down payment it was nearly impossible. I went through 4 different brokers before one really helped me, find a broker who knows what they are doing, too many newbies out there. I was going to use a co-signer but the first person i tried had good credit but low income, so she didnt work, second person had high income but bad credit so he didnt work. The co-signer has to have good credit and decent income or its useless in the banks eyes. I ended up working it out on my own by getting a hefty raise at work. Hope that helps, the process sucks, but the end result is the most rewarding feeling you could imagine. edit: I also had to pay 20% down on the house... No other way worked in my situation. Link to comment Share on other sites More sharing options...
Tearloch7 Posted May 13, 2014 Share Posted May 13, 2014 It's hard to say how long it will take unfortunately - As Tearloch7 says, definitely within a year, but whether or not it would be improved in time for August, I don't know. Equifax is pretty secretive about what exactly they use for credit scores and time frames. If she currently has no credit history at all according to equifax, than I would doubt it will be up by August unfortunately, as it usually take 60 days for changes to show up on the credit report when you do have something already reporting. Doing the secured card thing is definitely the way to go, and Tearloch7's suggestion of using it for household purchases is a good one. Hopefully you'll only need a few months before things start to show up on her credit report. Yup .. I get about $650.00 back every November .. free booze for Xmas! .. Link to comment Share on other sites More sharing options...
diesel_3 Posted May 13, 2014 Share Posted May 13, 2014 I am 22 and just bought my home back in january. The process was awful, as a 22 year old with good credit and a good down payment it was nearly impossible. I went through 4 different brokers before one really helped me, find a broker who knows what they are doing, too many newbies out there. I was going to use a co-signer but the first person i tried had good credit but low income, so she didnt work, second person had high income but bad credit so he didnt work. The co-signer has to have good credit and decent income or its useless in the banks eyes. I ended up working it out on my own by getting a hefty raise at work. Hope that helps, the process sucks, but the end result is the most rewarding feeling you could imagine. edit: I also had to pay 20% down on the house... No other way worked in my situation. Wow, that sounds like quite the headache. Glad it worked out in the end, though. LOVE owning! Link to comment Share on other sites More sharing options...
NucksCelts Posted May 13, 2014 Share Posted May 13, 2014 Wow, that sounds like quite the headache. Glad it worked out in the end, though. LOVE owning! The process took over a year. It was pretty awful. When you're young banks don't trust you at all. It also didn't help that the house I bought was also my fathers house who had passed away from cancer, and when it comes to estate stuff, the process is excruciating. The feeling of pulling up to a house you own though, really words can't describe it. Not to mention the mortgage payment on my 1900 sq/ft house with a little yard for my dog, and a big enough driveway for 5 cars is less/month than rent anywhere else, without a dog! Link to comment Share on other sites More sharing options...
Baka Posted May 13, 2014 Share Posted May 13, 2014 Tip number one: Don't ask random strangers on the Internet. Go to a professional. The internet is fine, full of a lot of useful knowledge. However asking a hockey forum and not doing thorough research is a recipe for disaster xD Link to comment Share on other sites More sharing options...
surtur Posted May 13, 2014 Author Share Posted May 13, 2014 it sucks because if i had the truck paid off it would free up a boat load of my owed monthly debt but the loan is finished in 15months.. and i could on my own get approved (hopefully) for a much higher amount just going by the online calculators it was the difference of around 75K wich in the area i am looking is the difference between a beat up fixer upper and a nice finished home not in the getto. as of now in the price range i "want" to look at (looking at paying around what i pay for rent maybe a couple hundred more) we have a 10% down payment plus closing costs etc. I also own some property in my name but it is undeveloped so not sure if they would look at that for anything. But thank you guys for the replies i got way more then i was expecting. Link to comment Share on other sites More sharing options...
Absent Canuck Posted May 13, 2014 Share Posted May 13, 2014 So it is coming down to the time me and the family would like to stop renting and purchase our first home so i hope someone on here has some banking knowledge to share. My situation is this i have a good credit score not Excellent but currently 726 which according to Equifax is considered in just in the Very good category. the problem is the amount i make and my current debt situation ie car loan credit cards etc when added together drops the amount i can be approved for into the almost impossible to find a decent house range. So i would like to have my spouse as a co-applicant the problem is she has Zero credit history. does anyone know how much it would affect our chances of approval. We have lived in the same rental for 8 years never missed a payment. We both work full time i am on salary and she is hourly. We have a down payment saved up and i am currently working on paying down my credit cards. anyone have any input? I dont believe a spouse with no credit history can boost up your income to lower the debt to income ratios. I am not versed in Canadian banking but I am in American finance. Contact your bank and ask if you can. If you can then make sure she has 2 years history with paystubs . Self employed becomes complicated. If not you can get a parent who doesnt live there to sign onto the mortgage but that will also mean they are on the title and have rights to half the house. Tip number one: Don't ask random strangers on the Internet. Go to a professional. I happen to be a Banking professional. Link to comment Share on other sites More sharing options...
surtur Posted May 13, 2014 Author Share Posted May 13, 2014 The internet is fine, full of a lot of useful knowledge. However asking a hockey forum and not doing thorough research is a recipe for disaster xD I can find a whole lot of info on certain things but the specific question did not result in much info from the web. also a hockey forum is full of people from many different professions and many people are willing to help answer some questions. Obviously I'm not gonna walk into a bank say give me a mortgage because so and so on CDC says i am good to go... I was just hoping for some info and so far got some. Link to comment Share on other sites More sharing options...
surtur Posted May 13, 2014 Author Share Posted May 13, 2014 I dont believe a spouse with no credit history can boost up your income to lower the debt to income ratios. I am not versed in Canadian banking but I am in American finance. Contact your bank and ask if you can. If you can then make sure she has 2 years history with paystubs . Self employed becomes complicated. If not you can get a parent who doesnt live there to sign onto the mortgage but that will also mean they are on the title and have rights to half the house. I happen to be a Banking professional. Shouldn't her tax return info be enough instead of pay stubs? obviously many things are different from Canada and the US and Banking is no different. as i said in a previous post having just my truck paid off would add 70+K on the approval amount according to the online calc .. and if i could add her on it would add another 40K to the approval amount.. So it would either be pay off the truck with half my down payment , and not need her to co-apply , and hope they don't require a larger down payment for the house i would like. or wait a a year or two for her to get some credit.. (our situation sucks and waiting that long isn't really an option) I have been paying Rent for over 12 years never missing a payment i have lived in my current rental 8 Years paying pretty much the amount that i would be paying for a house in the price range i would be looking at. and i make approx 20K more now then i did when i first moved in to our current rental. I wish banks would take real world info over a debt payment number yet paying rent on time in full takes a back seat to forgetting to pay a minimum credit card payment on time? not that i have but just saying. Link to comment Share on other sites More sharing options...
Absent Canuck Posted May 13, 2014 Share Posted May 13, 2014 Shouldn't her tax return info be enough instead of pay stubs? obviously many things are different from Canada and the US and Banking is no different. as i said in a previous post having just my truck paid off would add 70+K on the approval amount according to the online calc .. and if i could add her on it would add another 40K to the approval amount.. So it would either be pay off the truck with half my down payment , and not need her to co-apply , and hope they don't require a larger down payment for the house i would like. or wait a a year or two for her to get some credit.. (our situation sucks and waiting that long isn't really an option) I have been paying Rent for over 12 years never missing a payment i have lived in my current rental 8 Years paying pretty much the amount that i would be paying for a house in the price range i would be looking at. and i make approx 20K more now then i did when i first moved in to our current rental. I wish banks would take real world info over a debt payment number yet paying rent on time in full takes a back seat to forgetting to pay a minimum credit card payment on time? not that i have but just saying. Sounds like you are in a better situation than you think ! In the United States we have programs for first time home buyers. The government wants young people to invest in their communities and live the American dream. The programs are run by the Housing and Urban Development department (HUD) and the two that come to mind are FHA and 'Home Gain' . These two programs are designed for low to no down payment and all kinds of liberal rules for extra income or parents co borrowing. I did a cursory glance to see what Canadian programs would suit your needs. Are you and your wife legally married? Have you been so for at least 2 years ? Was she self employed or did she work for someone else (t4) . Provide as much info as you feel comfortable with. Link to comment Share on other sites More sharing options...
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