I'm starting to house hunt for my first home with my wife, we both have great credit, solid income and at least 10% downpayment saved up. However i recently was offered a position with a 20% raise at a new company. If i take the job how will this affect mortgage rates when i go to buy a house?
For the majority of banks (in the US), it will have no effect at all. (Banks that do manual underwriting may have their own custom rules.)
The rate you receive for a mortgage is based only on your credit score, and your credit score is independent of your income. (If you have zero income and still manage to pay all of your bills on time while maintaining a low utilization your credit will not suffer. Similarly, if you have a very high income but accidentally make some late payments, your credit score will still suffer.)
The amount of mortgage that you are approved for is based on your income in conjunction with the rate you will get, so the only affect getting a raise will have is an increase in the amount the bank is willing to lend to you.
There's no way to be sure. Each bank will underwrite differently, and each bank will have different targets as far as risk categories because they have different risk categories more or less well represented in their current portfolio (plus the many mortgage lenders who don't keep a portfolio and just pass on the mortgage to a third party). My lender is always willing to test out different scenarios, as they have a computer program that gives the rate given various parameters - underwriters still do their thing but the program usually is accurate.
You say you and your wife have great credit; great. If yours is better, it's possible your income could be enough to take the mortgage yourself without her credit on it. Your debt to income ratio does matter; it may not directly go into your interest rate, but it puts you in a particular risk bucket and that can give you slightly different rates -it did for one of mine. My credit was slightly better than my wife's, so we had to test whether it was better having a joint mortgage or only with my income - it was not clear which. The underwriters gave us two different rates based on that.
Most likely changing jobs won't hurt, but it may make it slightly more complicated to get the necessary information to prove your income history.