Yes, that structure is completely legitimate on a conventional loan. On any Fannie Mae or Freddie Mac program, including HomeReady and Home Possible, you don't have to use income you don't need to qualify. Your spouse can hold title to the home without being on the loan, and a non-borrowing spouse's income, debts, and credit stay out of the file entirely. That can be exactly what keeps a household under the income caps HomeReady and Home Possible use. Two wrinkles to keep in mind: - This flexibility is a conventional feature. USDA works the opposite way: its income limit counts every adult household member's income, whether or not they're on the loan. The same couple could pass a HomeReady income test on one income while USDA counts both. - Community-property states treat debts differently by program. On FHA, VA, and USDA in those states, a non-borrowing spouse's debts get counted. On conventional, they don't. Credit to your loan officer for knowing this, because plenty don't. Confirm the current income limits and eligibility rules for your file, since those change.