Tips for Unmarried Couples Buying Real Estate

According to a new report from Genworth Canada, more unmarried couples are choosing to buy a home together, and if that sounds like your relationship, there’s some things you should be prepared for.

Increasing numbers of Canadians are prioritizing homeownership over marriage. While the two are not mutually exclusive goals, low interest rates and the security of homeownership, have many common law couples saying: “Let’s buy!” before “I do.” [Genworth Canada]

• Do you know everything about each other, financially? Money is not something to be discrete about if you’re purchasing a home with someone, because everything will be laid out on the line during mortgage qualification time. Do you know each other’s credit scores? Does your partner have a lot of debt or a stable income? This will all be asked at application time, and it’s better to be honest about this stuff before you hear it during this process.
• Do you have a shared bank account? Taking this step will make mortgage payments and home expenses a lot easier. In addition, you can budget for mortgage, utilities, internet, groceries, etc. If you’re concerned about losing your financial independence, keep a separate savings account or credit card in your own name as well.
• Be ready to put it on paper. As much as it may seem like bad luck to plan for the failure of your relationship, you absolutely need to make official plans known for the event of a breakup, for the protection of both parties.

While no one likes to think about their relationship breaking up, unmarried, cohabitating couples should plan for this possibility and for the division of your shared property. Why? Because Common law couples do not necessarily share the same rights as married couples. That makes it essential to spell out who owns what (and who gets what in the event of a split) via a cohabitation agreement, whether that’s a 50-50 division, or another figure that reflects what each of you have invested into the joint property. [Genworth Canada]

If you and your significant other, married or not, are looking to purchase a home, please contact me.

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