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AZ Mortgage Question of the Day: My wife mortgaged our primary residence only in her name, do I need to count that against me when I qualify?


AZ Mortgage Question of the Day: My wife mortgaged our primary residence only her name, do I need to count that against me when I qualify?
 

Simple answer, YES. Arizona (and many other states- see below) is a community property state so debt is considered “common” between husband and wife regardless of who signed the note.  This is important for several reasons but primarily for asset requirements.  Every loan has a “reserve” requirement.  This means “a number of months of principal/interest/taxes and insurance for EVERY property that you own needs to be available in liquid funds.”

 

IF the wife, in this case, holds the Arizona mortgage note but BOTH parties are on the deed, this is considered community property and is subject to reserve requirements.  We want to make sure that the amount of assets available meet the reserve requirement.

 

Reserves are considered checking, savings, stocks, mutual funds, bonds, and retirement accounts.  Retirement accounts only receive credit for 60% of their balance (due to restrictions on having access to the money).

 

Special rules apply to spousal property and income in the community property states:

  • Arizona
  • California
  • Idaho
  • Louisiana
  • Nevada
  • New Mexico
  • Texas
  • Washington
  • Wisconsin

Feel free to contact me if you have any questions.

 
Having a dream is good, owning one is better!

 

 

Leslie Pelletiere, Owner

First Class Financial Services, proudly mortgage lending since 1999!

602.294.9288(O)

602.294.9830(F)

http://www.fcfs.net

MB#0902810

NMLS #162494

AZDFI Loan Officer # LO-0911453