Buying a Home With a Partner
There comes a point in time in every serious relationship where the topic of buying a home together will come up. While this is very exciting, there are some important factors that need to be considered before both people make the decision together to move forward with the process.
Getting Priorities Straight
All homebuyers will have different priorities when it comes to what kind of home they want to find. These might include bedroom and bathroom count, commute time, what type of home you want, neighborhood quality, good schools in the area, or having a large kitchen. It’s so important that both people in the relationship can agree on priorities. Chances are both people will not agree on every single thing, but both partners need to be willing to compromise on things that are not agreed upon.
Be Open About Finances
Money is another thing that both parties will need to be on the same page about, and if they’re not, a conflict will definitely be reached. There are so many costs involved in buying a home that need to be discussed and agreed upon before the home search begins. Not only does a mortgage budget need to be considered, but added closing expenses, such as taxes and insurance, down payment, home inspection, moving costs and closing costs, need to be discussed.
Costs for taxes and insurance will vary, but the others have relatively similar rates no matter what home you buy. The down payment is usually about 20% of the purchase price, closings costs will range anywhere from 2-5%, the cost of a home inspection will be about $300 and the moving costs average around $1200. When looking to purchase a home with a partner, make sure you both are in agreeance with a budget including everything. Both people need to also be realistic about what they can afford, as trying to stretch those limits will cause tension in the relationship.
Applying for the Mortgage
Before the home search begins, you will need to apply for a mortgage. If this is done as a couple, both of your credit scores will be taken into consideration. This is a very important thing to think about before applying, because if one person’s credit score is low, the mortgage might not be approved. Lenders always take the lowest score out of the two people applying. If this is a concern in your relationship, it would be a good thing to consider having only the person with the higher credit score apply for the mortgage.
Take the above things into consideration before making the final decision to buy a house with your significant other. This is a huge step to take in the relationship, so you’ll want to make sure you both do it smart and right.