Buying A Home With Family Or Friends – How To Make It Work
If you’ve been dreaming of buying a home but your finances aren’t strong enough to qualify, you may want to partner up with another family member or roommate in the same situation. By pooling your resources together, you’ll be in a much better position to buy a home. One benefit of cobuying with your roommates is there will be less adjustment because you’re already living together.
One scenario to consider is purchasing a property with individual units like a duplex or triplex. You’ll delight in some of the same benefits as your own home such as a private entrance, separate kitchen, and more. While this arrangement may seem advantageous, you’ll still have to address the issues of joint responsibility regarding ownership and monthly maintenance expenses for the land, roof, and other common areas.
Another less costly alternative is to buy a single dwelling and share the space together. One major problem with this arrangement is you would have to sacrifice your own private space. If you and the co-owner still choose to enter into this kind of arrangement, try buying a home with a layout that allows you separate private areas.
Buying a home with a co-owner has unique concerns and major financial issues. Be sure to sit down and discuss all possible scenarios with your future co-owner. One major issues will be in regards to how the down payment and monthly expenditures will be divided. Will everyone agree to split everything equally or will there be a percentage split based upon the amount of down payment contributed, who gets the larger bedroom, and other issues. There can be tax implications depending on the division of ownership.
Another issue to be discussed is what happens to a co-owner’s share of the property when he or she dies? Will their share automatically pass on to the beneficiaries of their will or trust? What happens in situations when one owner decides to go out-do they have the option to rent their share of the house, sell it, or require the other co-owners to sell or buy him or her out?
You need to get some excellent legal advice concerning these issues because how you and the other joint owners list the ownership on the deed legally determines what happens in these circumstances. Common ways to hold title on a property can include tenants in common or joint tenants with right of survivorship. It’s best to consult with a local attorney to determine which ownership is best for you.
Other issues you should agree on include what length of time everyone plans to live in the house (also what options are available when a co-owner decides to marry or when an elderly parent needs constant care); what course of action should be taken when a co-owner becomes unemployed; what style to furnish the house; and house rules (such as cleanup, household supplies, sound level of music, and overnight guests).
Buying a home jointly with another party is a huge commitment and it’s vital you choose the right person to partner with. Be sure to discuss all issues with your future co-owner and place the agreement in writing with the help of an attorney.
Want to find out more about buying a home in Orange County, CA? Check out these Tustin realtors and Yorba Linda Realtors to help you find one!
Comments
Leave a Reply