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Buying a house soon

GT1999

GT1999

Diamond Member
Don't know why but I'm a little shook up over it. Not married yet, so who's name does the house go under? Is legal paperwork needed?

Where the $$$ is coming from:

I make the same as the fiance, we make about 110k total gross
There's a big contribution from her parents for the down payment. They'll actually be paying most of it.

Her credit score is in the low 700s mine is in the mid 700s, so that shouldn't be a problem. She has no debt and I have about 400/mo in student loans/car.

We're looking in the range of $180k - $230k for a house so we aren't house poor.

Any opinions on the legal side since we aren't married yet? I'm not sure how that works.
 
If you are applying for the mortage together, both of your names should be on the deed. Legal paper would would be needed if you wanted a prenup.

Anyone can buy a house together, being married doesn't matter. It only matters if you break up and have to figure out who gets what.
 
No offense, but if you don't understand the $8k tax credit then you need to do more research before you buy a house. What are your reasons for buying anyways, too many people buy homes irrationally because it's "what you're supposed to do."
 
I found the website for it and we qualify. I didn't know what the income requirements were, or when it officially expired. It's April 30th.

http://www.federalhousingtaxcredit.com/faq1.php#1

I've been paying rent for too long and I don't see us breaking up, we already live together and have for a while now. It's a buyer's market right now.
 
Make sure you clear it with the bank that you are getting a large chunk of money for your down payment from a parent. They usually frown on that.

They will look back over your financial records, and if they see a large deposit, they will want to know where it came from.
 
I just bought mine in the end of October, but I'm a single guy so I didn't have to worry about having more than just my name on it....that would be a mess, especially if her parents are getting involved with down payments, etc. That sounds like the only issue you are really unsure about? Regardless, if it takes both of your incomes to get approved for that amount you will both be on the mortgage. It would only be a decision if you could get approved for the mortgage on your own.

The 8k tax credit was extended to April, and is easy to do. Since I bought mine last year I amended my '08 taxes and they sent me a check. You would do yours with your '09 taxes, or if you already have just amend them. It cost me $30 to file it with my tax guy and then took a few weeks before I got a check in the mail.
 
bignateyk said:
Make sure you clear it with the bank that you are getting a large chunk of money for your down payment from a parent. They usually frown on that.

They will look back over your financial records, and if they see a large deposit, they will want to know where it came from.
Click to expand...

The investment accounts are already in her name, they just haven't been handed over.
 
Geekish Thoughts said:
I've been paying rent for too long and I don't see us breaking up, we already live together and have for a while now. It's a buyer's market right now.
Click to expand...

What's wrong with paying rent? The idea that rent is money down the drain whereas buying a house is a great investment is terribly simplistic. Do you know for sure that you won't be moving in the next seven years?

Also, the fact that most of your down payment will be a gift from someone else will be hugely problematic. Seriously, you should educate yourself more about this topic before you take the plunge.
 
bignateyk said:
Make sure you clear it with the bank that you are getting a large chunk of money for your down payment from a parent. They usually frown on that.

They will look back over your financial records, and if they see a large deposit, they will want to know where it came from.
Click to expand...

They don't really frown on it at all, it's just a pain in the ass to document. I had borrowed my dad 6k a few months before I got my place, and they wouldn't even let him give it back to me without a documented "Gift Letter" and bank statements from his bank showing it came from him, etc. Even with my bank statement clearing showing a 6k check written to his name.

Gift letters are fine, just make sure you have plenty of time to get the documentation together and it's in the correct format for the bank you are applying to. I actually had to leave my closing to go to my parents' banks to get NEW cashiers checks made just to have the remitter's name printed on them, even though all the gift letters and account numbers lined up. What a freaking mess....I'm glad it's done.
 
yeah after the housing crash you have to have a long paper trail for all of your accounts. For instance I switched banks from JPmorgan (yuck) to a credit union several months before our house purchase and our lender needed all of the information on why this "new" bank account started and where the money came from. But from the numbers you gave us, sounds like you'll be fine.
 
If you get hitched in 2010 - then together, you will be able to use the 8K credit.
If not hitched, you will have to split the credit - how you do it is up to you.

If the mortage is in both names, both names will be on the title.
 
Keep in mind if she isn't applying for the mortgage with you and isn't going to be on the deed, her income won't be calculated into your ratios. You might make a decent salary but credit is tight right now and the bank might reject you if you have student loans. Depends on the size of the mortgage. Your estimated payment might be a piece of cake to pay, but the bank is only looking at W2s, your credit and your savings/investments to determine if you're risky.
 
Geekish Thoughts said:
The investment accounts are already in her name, they just haven't been handed over.
Click to expand...

be careful to account for any capital gains taxes you'll be paying if you cash the accounts out. that's 15% if they were long term that you'll own uncle sam at the end of the year.
 
SnipeMasterJ13 said:
I just bought mine in the end of October, but I'm a single guy so I didn't have to worry about having more than just my name on it....that would be a mess, especially if her parents are getting involved with down payments, etc. That sounds like the only issue you are really unsure about? Regardless, if it takes both of your incomes to get approved for that amount you will both be on the mortgage. It would only be a decision if you could get approved for the mortgage on your own.

The 8k tax credit was extended to April, and is easy to do. Since I bought mine last year I amended my '08 taxes and they sent me a check. You would do yours with your '09 taxes, or if you already have just amend them. It cost me $30 to file it with my tax guy and then took a few weeks before I got a check in the mail.
Click to expand...

just curious, you said you bought your house at the end of october, im assuimg 2009 correct? how were you able to amend your 2008 taxes to include a home purchase from 2009? I'm just curious, i have no clue when it comes to buying a house and doing taxes for homes.
 
My fiancee and I just did this ourselves. We closed at the end of December. The house is in both our names as is the mortgage. Married or not makes no diff as others have said.

Once you do purchase a house, where it gets a little interesting is if you want to combine your car insurance together with your home owners insurance. Some companies won't let you have a joint policy unless your married while others do. I had my insurance agent do the legwork on all that for us. She said once we do get married, to come back in so they can re-quote us with the other insurance companies to see if we can get a better rate. Other than that the only other tricky part is the taxes. You're not married so I don't think you can't file jointly, however you'll need to figure out how the first time home buyer credit factors in as well as any deductions either of you can claim for mortgage interest paid. I'll be going to an accountant this year since doing the taxes for both of us is going to be very complicated.
 
ppatin said:
Are you probably going to be living in the same place for at least the next seven years?
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Eh, that's not everything. I'll buy a house if I know im gonna be there at least 3 years simply because of how much nicer owning is than renting. No landlords, you get your own yard, no restrictions on what you can and cant do with the property, etc...
 
With your income that home price range would be quite affordable. You could easilly afford up to $300k without feeling house poor. But, it is better to spend the money on things that make you happy than just getting the biggest house possible. So, that is a wise move to try for a house in that price range.

Like others have said, you can use money from relatives. But, the easiest and best way to do it is to make certain that the money is in a bank account in her name ONLY for 2 months before applying for a loan (not a joint account). Thus, get it handed over NOW if you want to use it.

If the down payment is sizeable enough, then your fiancee would qualify for the house on her salary alone. If so, that would probably be the route that I'd take, then rent from her. True, you have no plans to break up. But odds are about 50/50 that you will. If you were married, then you'd have sound laws and legal precidence to get your half of the house. When you aren't married and when she clearly put in more money, you'll have a much harder time getting your money back if you break up. If she can't get the house on her own (ie your income is necessary), then I'd strongly urge you to get an agreement in writing between yourselves. That is, in writing how much are you contributing to the down payment, closing costs, and equity (and how you'd get that money back in case of a breakup). It will sound cold and unromantic, but as soon as you sign bank papers you are entering the cold/unromantic legal grounds anyways.
 
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Geekish Thoughts said:
The investment accounts are already in her name, they just haven't been handed over.
Click to expand...

Documenting it will probably be a pain in the ass. The mortgage broker is going to want signed letters from everyone involved, statements It'll be a huge pile of paperwork, but it's totally doable. I closed in October and a large portion of my downpayment was from a trust. Make multiple copies of everything and be prepared to be patient. You'll probably have to resend documents they lose and they'll keep asking for more and more things.

My sister and her fiance closed in December and it wasn't a problem. Just keep calling the mortgage broker to ask where the application is. They'll say "oh I need another pile of documents" send in the documents then call to verify they've been received and ask what you need to do next. Rinse/Repeat.
 
Looks like I'll need to amend my taxes for the credit, then. I just filed last night so I could get my refund asap. 🙁 I've never had to amend my taxes before, I hope it's not a pain.

I just called my bank about getting pre-approved, and we're going to contact a recommended realtor from her parents tonight to get the process started.
 
How many open houses have you gone to? Have you done any research about what the market in your area is like and what's a good deal? I'm not trying to poo-poo your home-buying ambitions here, but so many people buy houses for the wrong reasons. Be an informed consumer before you do it since this will probably be the biggest purchase of your life.
 
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