Should We Buy a Home if We are Not Married?

Should We Buy a Home if We are Not Married?

Everyone thinks they are the exception. “We can make it work”, yada yada, and with more and more  so-called non-traditional households becoming the norm (parents living with kids, older kids staying at home, siblings inheritance, multi-family households and same-sex parents, -fill in the blank, etc) the water gets a little murky as how to apply for a home loan and set up the title. As much as you think things will work out, they don’t always. So what are some things you should be aware of if you are buying a home with someone you are not legally married to?

Sometimes just thinking about the issues brings new light to the table. Consider all the possible scenarios and solutions when things get rocky. What happens in the middle of a pending offer should one party bail out, cancel or get angry and leave? Yes, people can get divorced but a legal marriage is a little more difficult to get out of than an unwed couple or friends getting into the real estate bed together. Getting out can be the tricky part.

Who gets what? Things can get tricky if you have to get out of the deal before it actually closes. Let’s say one person wants out once the transaction is pending. If all contingencies are satisfied, most attorneys will state they must follow through with the purchase of the house. (Be sure to contact your own lawyer for advice on buying)

There may not be protection for unmarried couples as there are for married couples. Written agreements, no matter how unromantic they may be, are essential in these situations.  With two names on the deed, they each own half the property and therefore will have to split it equally when dissolved.

Having an understanding about the situation before jumping in can solve a boat-load of problems in the future. 

VA Loans require couples to be married. This is an interesting realization and a safety precaution for many home loans.

What happens if one person dies? This is a little easier although just as confusing. The part of the property that belonged to the deceased will go to their beneficiary but this still needs to be in writing.

Many nontraditional homebuyers purchase real estate every day and this is not to say that they shouldn't, but they should be very clear in written documentation about what happens to the property upon dissolution of the relationship. People shouldn’t look at this as an unromantic "prenuptial type agreement", but they should be wise when it comes to any type of real estate transaction whether married or not.

I love helping homebuyers find the right property regardless of their situation. For information on buying in the San Ramon real estate market, gets for homebuyers and advice on buying in our area, call me today.