Marriage marks the beginning of a new chapter filled with shared dreams and responsibilities, including the purchase of a home. In Australia, marriage can influence your mortgage options in several ways. Here’s a condensed look at how tying the knot may impact your ability to secure a mortgage and what to consider as a married couple.

Increased Borrowing Power

Applying for a mortgage as a married couple can boost your borrowing power due to combined incomes. Lenders often view this as a stronger financial position, potentially allowing you to borrow more and purchase a more desirable property.

Shared Financial Responsibility

Marriage means sharing financial responsibilities, including mortgage repayments. This shared responsibility can make lenders more confident, possibly resulting in more favourable loan terms or interest rates.

Credit Scores and Financial History

Both partners’ credit scores and financial histories are considered in a mortgage application. A poor credit history from one partner could affect your application, while strong credit scores from both can enhance your chances of securing a better deal.

Deposit and Savings

Pooling resources can make it easier to save for a larger deposit, increasing your borrowing capacity and potentially avoiding Lenders Mortgage Insurance (LMI). In Australia, LMI is typically required if your deposit is less than 20% of the property’s value.

Ownership Structure

Decide how to structure property ownership: joint tenancy (equal ownership with automatic inheritance) or tenants in common (specific, potentially unequal shares). This decision has legal and financial implications, especially in cases of separation or death.

Future Planning

Discuss and align on long-term financial goals, repayment strategies, and contingency plans for life changes, such as starting a family or career shifts.

Marriage can positively impact your mortgage options in Australia by enhancing borrowing power, sharing financial responsibilities, and pooling resources for a larger deposit. Consider both partners’ financial histories and future plans carefully, and seek professional advice to make informed decisions. This approach can help you achieve the shared dream of homeownership and financial stability as a married couple. Happy house hunting!