Congratulations on your wedding and decision to buy a home together!
After you get married, you and your partner are probably eager to take the next steps. For many people, this means buying a home. It’s time to settle down with your spouse, and start making your homeownership goals. This is a major financial commitment, so it’s normal to feel overwhelmed.
Buying a house is a stressful but exciting experience, and having your new partner by your side can make the process so much better.
Remember that buying a home is a big decision, so take your time and make sure you’re both comfortable with the process and the home you choose. Good luck!
1. Determine your budget
Before you start looking at homes, it’s important to determine your budget. Consider your combined income, expenses, and any debt you may have. This will help you determine how much you can afford to spend on a home.
2. Plan for future expenses
In addition to the purchase price of the home, you should also plan for future expenses such as maintenance and repairs, property taxes, and insurance. These expenses are often overlooked by first-time homebuyers and failure to plan can be a financial disaster.
3. Hire a real estate agent
A good real estate agent can guide you through the home buying process, provide valuable insights about the local market, and help you negotiate the best deal. Hire someone who can act as a Buyer’s Agent and put your interest first. Here’s more information about Buyer Representation in Texas.
4. Get pre-approved for a mortgage
Getting pre-approved for a mortgage will give you a better idea of how much you can afford and help you narrow down your home search. Here are some of the things you need to be aware of before you start.
5. Know your credit history
Your credit score and credit history are key factors in whether or not you’ll be approved for a home loan and what interest rate you can get for your mortgage. Credit scores are calculated based on a number of components, including the length of your credit history, the number of total accounts you have, and the number of payments you’ve missed. Most buyers need a credit score of at least 620 to buy a house, but a higher score will earn you a better interest rate.
If you’re not already aware of your and your spouse’s credit histories, you should obtain a copy of both credit reports before you begin your home search. This will confirm that you have the creditworthiness needed to become a homeowner, and it can show you what areas you may need to work on if you want to get better mortgage terms.
One of the biggest goals for most newlywed couples is to reduce their debt-to-income ratio. This is the percentage of your monthly income that goes toward debt repayment, including your mortgage or rent costs. Not only does reducing your debt strengthen your credit score, but it can also help you get approved for a larger mortgage. Banks like to see a debt-to-income ratio of less than 36 percent.
Some newlyweds find that one spouse has great credit and the other has poor credit. In this case, the partner with the higher credit score could apply for the mortgage in their name alone. However, you should ensure that both spouses are listed on the property title. And understand that Texas is a community property state and what that actually means to you as a new couple.
6. Choose the right location
Consider the location of the home, including proximity to work, schools, and other amenities that are important to you. Be sure you have access to things that are important to you and your spouse. With more and more work from home options, having lightening-fast internet is more important that ever before.
7. Consider your current and future needs
Before you look at any homes, both partners should have a general idea of what they’re looking for. First, determine whether you want to purchase a starter home or a house you’ll live in for decades to come. Most real estate experts suggest that you only buy a home if you’re prepared to live in it for at least five years. Your needs in the next few years may be very different than your needs in 10 or 15 years, though. Maybe all you’re looking for right now is a small and affordable house that fits you and your spouse, or maybe you hope to find a home with enough space to raise children.
In addition to considering space and location, you also have to think about your budget.
- How much money can you put toward a mortgage each month without feeling financially strained?
- Are you expecting any major financial changes in the next few years?
- Be careful not to rely solely on your mortgage pre-approval for this step.
- You might be approved for a large monthly payment, but this doesn’t mean that you can realistically afford it.
Newlyweds typically have more success searching for homes at the lower end of their price range so that they have some flexibility in their budget as they adjust to life as homeowners.
8. Be ready to compromise
As a newly married couple, you and your spouse probably aren’t strangers to compromise. Although compatible partners see eye-to-eye on a lot of ideas, no two people will ever agree on everything. Learning to make sacrifices and meet in the middle with your spouse is one of the best life lessons for newlyweds, and your journey to becoming homeowners can put those skills to the test.
Both partners should separately write a list of their priorities for the new house. This includes location, size, number of bedrooms, or amount of renovation needed. Then, you should list your needs and wants in order of importance. When comparing your list with your spouse’s, be prepared to sacrifice some of the lower items on your list so that you can both fulfill your most important needs.
9. Decide on your must-haves
Discuss with your spouse what you both want and need in a home. This will help you focus on properties that meet your criteria. Sorry to say, but it helps to make a checklist and prioritize for both of you, such as discussed in the paragraph above.
10. Be wary of predatory loans
Working with a trustworthy real estate agent will help you avoid bad sales or predatory loans. Newlyweds are often so eager to become homeowners that they’ll agree to deals that aren’t in their best interest. For example, you might get approved for a home loan with an exceptionally low interest rate, but the fine print describes massive late fees or other penalties. If something seems too good to be true, consult with a realtor or financial expert before you move forward.
11. Get a home inspection
Before finalizing the purchase, it’s important to get a professional home inspection. This will help you identify any issues with the home that may need to be addressed before you move in. Again, the guidance of your real estate agent will be invaluable during this step.
Conclusion
Before you and your spouse buy a home, you should have a thorough understanding of your credit history, your financial standing, and your needs and wants for your home. By approaching this process as a team, you’ll lay the groundwork for success as new homeowners.
You and your partner should take your time as you get ready to buy a house. Do your research before you look at homes, and make sure you’re both on the same page. As stressful as house hunting can be, the joy and excitement of finding the perfect home to start your married life can be well worth the effort.
Contact a North Point Agent to get started!