Skip to content
Home » Should You Buy a House Before Marriage?

Should You Buy a House Before Marriage?

Buying a house with your boyfriend, girlfriend, or longtime partner can be an exciting and life-changing decision with financial benefits for both of you. However, it is important to consider all aspects of this type of purchase, including the potential risks, as well as the requirements for obtaining a mortgage. In this article we will take a look at some of the potential benefits and risks to buying a house together before marriage. 

One of the main benefits of buying a house before marriage is the ability to share the financial burden of homeownership. Instead of shouldering the entire cost of a home on your own, you and your partner can split the mortgage payment and other expenses, making home ownership more affordable for both of you. Additionally, buying a home together can be a great way to build financial stability and investment for the future.

Another factor to consider when buying a house with your girlfriend, your boyfriend or anyone you are not married to is the requirement for a mortgage. In most cases, you will need to qualify for a mortgage on your own, regardless of whether you are married or not. This means that each person will need to have a good credit score and enough income to support the mortgage payment, even if only one person is listed on the mortgage. In some cases, it may be possible for one person to be the primary homeowner and the other to be a co-signer, but this will depend on the specific requirements of the lender and the nature of your relationship. Your experienced realtor should be able to give you suggestions of several different lenders for you to check out and see what is the right fit for you. 

However, there are also a number of risks to consider when buying a house before marriage. The biggest risk is that if you and your partner break up, it can be difficult to determine who will get to keep the home and how any equity will be divided. This can be especially complicated if one person has contributed more to the mortgage payments or renovation costs than the other. Additionally, if one person passes away, their share of the home may pass on to their next of kin, leaving the surviving partner with an uncertain future.

If it cannot be determined who owns a property with a shared mortgage, the ownership of the property will be determined by the laws of the jurisdiction where the property is located. These laws may vary from state to state, but they generally fall into one of two categories: title theory states or lien theory states.

In title theory states, the bank or mortgage company holds the title of the property until the mortgage is paid in full. In title theory states the lender holds the title to the property in the name of the borrower through a Deed of Trust. When the loan is paid in full, a Deed of Reconveyance is issued by the lender and this creates a clear title of the property. In lien theory states, the bank or mortgage company holds a lien against the property and never retains title to the property. In this case, the deed stays with the borrower and the lender has a lien on the property using a mortgage. When the loan is paid in full, the lien ends.

In a case where ownership cannot be determined, the parties involved may need to go to court to resolve the matter. This can be a costly and time-consuming process, and the outcome is uncertain. In some cases, the court may order the sale of the property to pay off the mortgage, with the proceeds being divided among the parties.

To avoid such a situation, it is important for co-borrowers to have a clear understanding of their rights and responsibilities with regards to the property and mortgage before they sign any agreements. They may also want to consider having a written agreement in place that spells out the ownership arrangements and outlines what will happen in the event of a dispute. 

When it comes to buying a house before marriage, it is important to have a clear understanding of your financial goals and priorities. This can help to ensure that both partners are on the same page and that the purchase is aligned with your shared vision for the future. Additionally, it may be helpful to work with a financial advisor or real estate agent to understand the full range of options available to you. By doing so, you can help to ensure that your home buying experience is a successful one.

Leave a Reply

Your email address will not be published. Required fields are marked *