Ah…. Valentine’s Day. A day when couples young and old start to think about their future together. And often the most important part of that future is buying a home.
February is a great month for buying a house – in fact, it’s often better than the traditional seasons of spring and fall. According to ATTOM Data Solutions, the combination of fewer buyers and the resulting lower prices can mean that some of the best home-buying days of the year occur around Valentine’s Day.
What are the top considerations when you are a newly engaged or committed couple ready to make the leap to home ownership?
The first step is to understand how much home you can afford. You achieve this by working with a lender who will not only pre-qualify you, but who will pre-underwrite you. This involves submitting documentation about your income and assets and processing information as if you were applying for a mortgage. When this is complete (which usually takes a day or so as long as you turn in your documents promptly), you’ll be ready to make an offer, and the seller will know that the two of you have the ability to buy their property. This gives you a tremendous advantage when competing for properties that may be receiving multiple offers.
The second consideration is to ensure you know where your down payment and closing cost funding is coming from. Many lenders have grant programs – YES. GRANT PROGRAMS – that DO NOT have to be paid back. When you work with a knowledgeable realtor, he or she can connect you with the right resources to make your experience a positive one. Texas has special grant programs for teachers, EMS personnel, firefighters, police, etc. Find out if you qualify!
And, what type of home ownership arrangement do you want? Texas is a community property state, meaning that unless a couple signs a prenuptial agreement, they will automatically own the house together. However, some couples, married or not, prefer to keep their finances separate even if they are living together. This may result in choosing to buy a home as a joint tenancy in common, or a joint tenancy with rights of survivorship (you may need to make a will at the same time). Or, you may choose a tenancy in common, with ownership in different percentages. These financial options are available to all families, traditional or same-sex couples, etc.
And on a more personal note, you want to be practical about prioritizing the things you each want to have, versus the features you must have. This is where couples learn to negotiate! Talking over desired commute times, locations, schools, resale value, and so on will help you each define what is most important in buying a new home. A smart realtor will be able to help guide you through this process (and sometimes serve as a mediator!) to assure that you both get the home of your dreams.
Happy Valentine’s Day, everyone!