Applying for a Loan with Your Same-Sex Partner

Since same-sex couples are not viewed the same by the state - or by financial institutions - as married couples, applying for a loan with your same-sex partner can be difficult. Even if you live together, and even if you are raising a child, the process won't be as easy and you might have to fill out extra paperwork in order to apply for the loan. And although it is unlawful for a financial institution or lender to discriminate against same-sex partners, it happens.

First of all, you and your same-sex partner should be in total agreement about the loan. Sit down and examine your financials carefully, determining exactly why and for what you need the loan. Using an estimation of your monthly income, as well as an understanding of your pre-existing expenses, determine how much you can afford to borrow while still paying the loan back from month to month.

Next, you and your same-sex partner should have a discussion about the obligation to the loan. Depending on how long you and your same-sex partner have been together, you might not know enough about each other to be confident that you each will uphold your end of the responsibility. If you apply for a loan together, you will both be affected if one of you defaults, which can mean life-long struggles with credit.

You should also consider the longevity if your relationship. How long have you been together? Is it serious? Do you have any other community property? How would you handle the repayment of the loan should you break up? Obviously, you cannot foresee every eventuality, but you should be prepared if the worst should happen. Also, finances can place a strain on any relationship, no matter how strong. Review the methods with which you have dealt with expenses in the past. Do they work?

It is usually best to discuss applying for a loan with your same-sex partner before you even enter your bank or lender's office. This way, you won't have unanswered questions that need to be discussed in front of a stranger, putting everyone involved in an uncomfortable situation.

When you go into a financial institution to apply for your loan, be as up-front as possible about your situation. Explain that the two of you are in a romantic relationship, and that you are hoping to apply jointly for a loan. Most lenders have dealt with this situation before, and your explanation shouldn't elicit the slightest response - either positive or negative.

Since you are applying for the loan with your same-sex partner, you will each have to fill out the application form and sign it. Your credit histories will be run by the lender, and will let you know of any discrepancies. You will need to decide the length of the loan and negotiate the interest rate.

Remember that, in the event of a break-up, you will each be responsible for repaying the loan. The laws that govern heterosexual marriages do not apply to same-sex partners, which means that the law won't divide the shares of the loan based on income or resources. You will have to work those details out amongst one another.

If you are made to feel uncomfortable at all by the financial lender, don't bother doing business with him or her. Find a financial institution that doesn't have a problem with applying for a loan with your same-sex partner, and don't feel obligated to go through with a transaction you are uncomfortable with.