1 or 2 Spouses on Title with Conventional Loan in 1 Spouse's Name

[Zeb B.]

If only one spouse will be a borrower on the mortgage for a property, is there any benefit from a financing perspective for both spouses to be listed as an owner on the title?

My spouse and I currently own 6 single family rental properties, a duplex and our primary residence which is will be 3 units when we are done remodeling it. We have conventional, 30 year fixed rate mortgages on all of our properties. 

Each of us owns 4 of the properties with the title solely in our own name (we have a umbrella insurance policy and have not set up any LLCs.) We do not have any mortgages in both of our names, each of us is the only borrower listed on the mortgage for the properties that we own.

We are currently doing a cash out refinance on one of our single family family rentals to fund our remodel. I know that there are benefits for conventional mortgages to be in only one person's name. That way the limit of 10 conventional mortgages will allow us to buy 20 properties between the two of us rather being limited to 10 if we take the mortgages out jointly.

If I take the mortgage on the property we are refinancing in my name only, would it be a good idea to keep my wife listed as an owner on the title? I am thinking that would allow my wife to use the income from that property to improve her debt to income ratio which will help her qualify for a mortgage on another property in the future. Any disadvantages to both of us being on the title?

[Andrew Postell]

@Zeb B. you are on the right track here.  Owning is different than who is responsible for the mortgage.  In theory, I could be responsible to pay the mortgage and you and your spouse own the property.  So who owns the property does not equate to being responsible for the debt.  It's totally ok for you both to be on the deed/title of the property and only 1 of you on the loan.  And if you own the property, then you can use that income to help you qualify for other things.  Or say "I have experience with rental properties" (which some loan types want to see) so it can help with other things.  By rule, anyone who owns the property would also be responsible for the property taxes...so there's some responsibility here that get added if you own....but for the most part it's pretty good to have you both on the ownership piece of it.

Hope all of that makes sense.  Thanks!