Do you plan to take the next step with your partner and buy your first house together? Congratulations! Many couples today choose to buy a home before getting married. Living with your partner can be a rewarding experience that allows you to learn more about each other. Also, by living together under the same roof, you may be able to save money.
However, this is not a matter to be taken lightly. Buying a home and taking out a mortgage with someone else is a huge step that requires commitment. So, while there are many benefits, it’s also something that should be considered carefully.
In this article, we’ve discussed some of the pros and cons of buying your first house as an unmarried couple.
Pros and Cons of Buying a Home as an Unmarried Couple
Your significant other might be a stand-up person, but that doesn’t mean they have the same financial values as you. On the other hand, if everything goes well, it could be a great experience that benefits you both and strengthens your relationship. Consider these pros and cons before buying your first home as an unmarried couple.
Securing a Bank Loan Could Be Easier
When buying a home, one of the biggest hurdles people face is obtaining a loan. You need to be able to prove to the lender that you can afford a home and make payments on time. This is largely dependent on your income. And when you apply with your partner, your combined income is used to determine your eligibility. This could increase your odds of being approved.
However, it’s important to remember that income is not the only deciding factor. Both of you will also need a good credit score and debt-to-income ratio.
Great Investment for Your Future
Buying your first home is a huge milestone. Whether you do it with a partner or alone, it’s a pretty big deal and can be a huge step forward in life. Real estate is generally considered a beneficial and safe financial investment.
Save Money on Rent
Another benefit of buying a home with your significant other is that you could save money by moving in together. Instead of paying rent separately for two different places, you will be able to pool your resources.
Could Decrease Your Odds of Approval
Having your partner on your mortgage application isn’t always a good thing. While your partner’s finances can have a positive impact on your borrowing capacity, it can also go in the other direction.
If your partner has a troubled credit score, having them on your mortgage application could make it difficult for you to obtain financing. Additionally, if your partner has a lot of debt, that could also affect your odds of being approved.
If you have concerns about your partner’s finances, it may be a good idea to reach out and get help. An expert can help you figure out what the best option is for your situation.
You Could Break Up
If you and your partner break up, you may find yourselves in a tricky financial situation. If the relationship ends on bad terms, things could get messy. This is not to say that married couples can’t go through the same experience. But the level of commitment may be different. There’s no sure way to tell the future, but this is still something important to consider.
Have Questions About Buying Your First House?
Do you have questions about buying your first home? Call Mortgage Solutions Financial to speak to an expert today!