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Buying a Home with Your Spouse: The Complete Guide for Couples
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You’re in This Together Owning a home is a big part of “the American Dream.” Once you’ve tied the knot, you and your spouse may find yourself thinking about purchasing a home together. But buying a home is one of the biggest investments you’ll ever make as a couple, so it pays to put some forethought into the buying process before making the leap to joint homeownership.
No Surprises OK, so a surprise house sometimes works out well in the movies, but in real life, purchasing a home behind your spouse’s back is more likely to end in disaster than elation. Worst-case scenario: you end up purchasing a home that you love but your spouse loathes. That’s a foolproof recipe for heartache.
No matter how much you and your spouse have in common or how well you think you know them, it’s just not fair to choose a home for them without their input.
Make a List, Check It Twice A great way to start the home-buying process together is by making individual lists of everything your ideal home would have. Then split your lists into needs and wants. Compare notes. Your wish lists may coincide on many key points, but there might be a few ways in which they differ quite substantially, which can lead to insightful conversations. This exercise will help you prioritize what’s really important as a team, and as an added bonus you’ll get to know each other even better.
A Penny Saved Is a Penny (Plus Interest) Earned Conventional wisdom used to be that you needed 20% down to buy a home. That’s not the case these days, and with interest rates poised to steadily rise in the coming years, you may be better off buying sooner rather than later. On the other hand, plunking down 20% or more will save you money in the long run, because you won’t have to pay for personal mortgage insurance. Plus, every extra dollar you put down at closing is a dollar you won’t have to pay interest to borrow.
If you’re planning on purchasing a home in the future, start saving now. Go over your budget together, and see if there are ways to save a little extra each month. Buy a travel mug and make your coffee at home. Take a sack lunch to work every day. Instead of going out on the town, invite your friends to your home. Before you know it, you’ll have accumulated a substantial chunk of change.
Work on Your Credit Together We wouldn’t be so callous as to suggest that you marry (or not marry) someone based on their credit rating, but when one partner has lackluster credit, it can really put a drag on a couple’s purchasing power.
If you, your spouse, or both of you have bad credit, start working on it now. Pay down your balances, dispute any reporting errors, and be sure to make your payments on time. Your credit rating is a key factor in qualifying for an affordable mortgage, so improving your credit before you buy a home will pay great dividends.
Get Pre-Approved for Financing This piece of advice should be given to homebuyers in any situation, but it’s doubly true for couples. Securing preapproval from a mortgage lender will give the two of you a clearer picture of what sort of home you can afford. There’s no sense in falling in love with a house that’s outside your budget. Plus, pre-approved buyers have an edge over those who don’t have their financial ducks in a row, especially in a seller’s market. Don’t Spend More Than You Can Afford
Financial woes are one of the main causes of divorce, and being house-poor certainly qualifies. What good is owning a wonderful home if you have no money for good times or creature comforts? Stay within your budget. If you outgrow your home, you can always sell it or rent it out when you upgrade.
Ask a Real Estate Agent for Help You and your spouse are a couple of smart cookies. After all, you’re here doing your research to make sure your relationship survives the home-buying process intact. But unless one of you is a real estate agent, you’re probably still outside of your depth when it comes to purchasing a new home. And that’s OK – we can’t be experts at everything. This is why we strongly recommend hiring a buyer’s agent. If there was ever a time when you needed sound advice and an unbiased perspective, this is it. Let the Home Buying Process Bring You Closer
Most couples find that purchasing a home jointly brings them closer together, and we definitely hope your experience works out that way. Follow these tips, and the odds of your house purchase turning into “home, sweet home” are excellent.