As Valentine’s Day approaches, you may be thinking seriously about your sweetie — and perhaps considering some serious next steps. Buying a house together can be as financially savvy as it is romantic… if you play your cards right, that is.
Becoming joint homeowners not only allows you to easily share a roof, but also to potentially build equity together, which could lead to a brighter financial future. Then again, buying a house together is a major decision, right up there with having children or getting married. It’s worth thinking it through carefully and making sure you ask the right questions, both of each other and of the real estate agent and home seller.
Which is exactly why you’re here, reading this article! So without further ado, here are some steps to take and things to consider if you’re planning to buy a home with your honey.
1. Get clear about what you want.
If you’re far enough along in your relationship to be seriously considering buying a house together, you probably already know that everything is about communication. So the first step toward successfully buying a house together is to figure out what each of you wants out of the deal and communicating those wants and needs to each other.
Chances are this step is going to take compromise. Maybe he’s a city slicker and she’s ready to beat feet for the countryside; maybe she’s open to looking at townhomes and condos but her wife is nervous about sharing walls. From location to home style to how many bedrooms and more, take the time to get a really clear picture of what you’re aiming for, and ensure your partner does the same — and be honest about what you’re each willing to sacrifice.
2. If you’re unmarried, you’ve got homework to do.
Applying for a mortgage as a married couple is fairly straightforward: you can easily be co-borrowers on the loan with the intention of splitting the equity 50/50.
But if you’re not yet married, things get a little trickier — and require even more communicating.
Will one of you apply for the mortgage, or both?
How will you eventually hold the title? Sole ownership? Joint Tenancy? Tenants-In-Common? You’ll need to do your research, perhaps seek an attorney’s counsel and work this all out ahead of time.
How will you split the utilities and costs of repair and maintenance? And what, exactly, happens if you split up — or if one of you dies or becomes severely disabled?
All of these terms are up for negotiation — and you’ll need to sit down and negotiate them (and potentially draft up a legally binding document outlining your agreements) before you get serious about house hunting.
3. Get your application right.
Given how much heavy lifting you’ll have to do in terms of weighty talks and negotiations with your partner, chances are you’ll want to minimize the back-and-forth when it comes to actually buying the house. With a competitive market, nothing is guaranteed, but there is a certain art and science to writing a winning offer letter.
In addition, choosing the right lender can make all the difference when it comes to enjoying the domestic pleasures of joint homeownership. And, if your financial profile looks a little different than other borrowers — say, if you’re self-employed or shopping as a foreign national — you’ll want to find a lender who uses a holistic approach to qualifying their applicants.
As one of only 3% of American banks with a CDFI, or Community Development Financial Institution, certification, it’s part and parcel of our mission to match worthy applicants with the financial goods and services they need — and mortgages are one of our specialties. Our Community Development Loans (CDLs) are specifically designed with non-traditional borrowers in mind, and might be just the ticket if you’re a borrower with irregular income such as a freelancer or small business owner.
We also offer other mortgage loan programs, such as FHA and VA loans — and we’d love to help walk you through your options. Contact one of our mortgage specialists for more information today!
Quontic Bank is not affiliated with or acting on behalf of or at the direction of Federal Housing Authority (FHA) or any government agency or government sponsored entity. All lending products are subject to approval. Rates, program terms & conditions are subject to change without notice. Not all products are available in all states or for all amounts. This does not represent an offer to enter into a loan agreement. Other requirements, restrictions & limitations apply. Information is accurate as of February 8, 2022 & is subject to change without notice.