By Pam Friedman, CFP®, CDFA® and Abril Espinoza Jimenez, ChFC®, CDS®
January 21, 2025 – Buying a home with your partner is an exciting step, but it’s also a significant financial and emotional commitment. To ensure the process goes smoothly—and to protect both your relationship and your investment—it’s essential to discuss some critical topics before purchasing. Here’s everything you need to know to get on the same page.
One of the first things to figure out is ownership. Will you split it 50/50, or will ownership reflect who contributes more to the down payment or other costs? How you set up the title is equally important. Options like Joint Tenants with the Right of Survivorship or Tenants in Common affect what happens to the property if one of you passes away. Having these discussions early can save you from confusion or disputes later. Drafting a formal agreement is a great way to ensure everyone is on the same page about who owns what.
Once you’ve sorted out ownership, consider how you’ll handle ongoing expenses. Homeownership comes with regular costs like mortgage, property taxes, insurance—not to mention unexpected repairs. Will you split these equally or base contributions on income? A clear plan can prevent misunderstandings, and you may want to consider setting up a joint account to manage shared expenses more easily.
Of course, even the best relationships hit bumps in the road. It’s important to plan for disagreements about the home. For instance, how will you resolve conflicts—through mediation or arbitration? And what if one partner wants to sell the house while the other wants to keep it? A conflict-resolution strategy written into your agreement will make things less stressful if disputes arise.
Renovations are another area where clarity matters. How will you decide on significant changes and split the costs if you plan to make upgrades? It’s helpful to agree on a spending threshold—say, anything over $1,000 requires mutual consent. And if one partner pays for a large upgrade, will they be reimbursed or gain a larger ownership share? These conversations can make renovations more enjoyable and less contentious.
While no one likes to think about breakups, planning for the possibility is crucial. If one of you decides to move out, who gets the option to buy the other out? How will the buyout price be calculated—by appraisal or market value? And if neither partner wants to buy, how quickly will the house be listed for sale? Addressing these scenarios now can make things much easier if the unexpected happens.
Life has a way of throwing curveballs, and flexibility is critical to handling them. Job losses, new roommates, or family changes can affect your ability to manage the home. Plan for how you’ll adapt if one partner can’t afford their share of payments or wants to bring in someone else to live in the home. Revisiting your agreements regularly ensures they still fit your situation.
Planning for the unexpected also means thinking about what happens if one of you passes away. Will the surviving partner have the option to buy out the other’s heirs? Ensure your wills and estate plans align with your homeownership agreements to avoid unnecessary complications.
Finally, don’t forget to consult professionals to cover all your legal and insurance bases. If you’re not married, working with an attorney to draft agreements that comply with local laws is especially important. And make sure you have adequate homeowners’ insurance and liability coverage to protect your shared investment.
Buying a home with your partner is a big step, but with the right planning, it can also be a rewarding experience. By discussing these key topics and establishing clear agreements, you’ll safeguard your finances and strengthen your partnership. Taking the time to plan now will save you from stress later and set you up for success in your shared homeownership journey.
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