Buying a home with a significant other is a huge commitment. While it can be an exciting and fulfilling event, before you sign on the dotted line, it’s important to make sure you and your partner are on the same page about the purchase.
And how do you do that? You ask the right questions.
A recent article from realtor.com answered questions couples should ask each before buying a home together, including:
- How much debt do you have? You might not have full transparency into your partner’s finances, and vice versa. But before you buy a home together, it’s important for you both to be upfront about any debt, including credit card debt, student loans, and other loans, like car or personal loans. These debts — and, more specifically, the ratio of your debts to your incomes — will play a huge part in whether you’re approved for a mortgage, so it’s important to understand where you and your partner stand financially before you start the process.
- What’s your credit score? It’s not just current debts that matter. Your credit scores — which measures your ability to pay past debts — are also an important factor in determining mortgage eligibility. Lenders look at your credit score as a predictor of how likely you are to pay your mortgage payments in full and on time, so make sure you and your partner pull your credit scores and discuss them before applying for a loan.
- How much money do you have for a down payment? Another question to ask your partner is how much money they have saved for a down payment. If, between the two of you, you can put down 20 percent, you’ll be able to avoid paying private mortgage insurance (PMI), which increases monthly payments.