Couples who are in committed relationships are nowadays often left in a position where they have to decide whether to shop for the perfect, sparkly engagement ring, or rather buy something which is equally shiny and precious – their dream home.
A couple should contact their attorney to prepare a written document, such as a sale, lease or partnership agreement, which clearly stipulates the full details of the necessary arrangements and includes the percentage of the home’s equity each partner is entitled to, which is important in cases where you and your partner contributed different amounts to the down payment.
Where a couple chooses to purchase a home, this is an investment for their future. One must consider that married couples are protected by the body of law, which protects their rights should their marriage be dissolved, however, unmarried couples are faced with a situation where the law is “not always exactly clear”.
Couples should consider the following tips before taking the leap of buying property together…
1. Be transparent. I suggest that, should you and your partner seek to purchase your dream home, have an honest discussion about your financial history. Plenty of couples get married without knowing each other’s salaries or how much credit card debt he or she has. However, when it comes to qualifying for a mortgage, your salary, credit card debt and savings are all on the table, therefore it is crucial to disclose information that could possibly prevent you from obtaining a low rate on a home loan.
2. Whether or not the property will be registered in both partners’ names. It is advisable to have the property registered in both parties’ names so that each would individually own a registered right in immovable property. The acquisition of property (whether held by them individually or only by one owner) could attract adverse tax implications.
3. You and your partner as purchasers should calculate what you can afford or what you are willing to spend and furthermore what type of property you wish to purchase.
4. Once you and your loved one have decided to enter into the property market, and know in which area you would like to purchase, an important step is to consult a reputable real estate agency that specialises in your area. It is useful to gain a feel for the property markets and neighbourhoods in various suburbs by browsing property websites and the weekend property guides, therefore it is important for a couple to consult with a well-known agency who can assist you in making an informed decision.
5. When a couple is ready to make an offer on a property, contact your attorney to discuss the offer you want to present to the seller. Your attorney can assist you with drafting your offer to purchase, provide you with an estimation of the conveyancing fees and explain the different cost items you may face. Also, ask your attorney whether you may need to update your will with the details of the new property that you will be acquiring.
6. Put your agreement in writing. A couple should contact their attorney to prepare a written document, such as a sale, lease or partnership agreement, which clearly stipulates the full details of the necessary arrangements and includes the percentage of the home’s equity each partner is entitled to, which is important in cases where you and your partner contributed different amounts to the down payment. Also, details should be included in this agreement as to what will happen to the property should you split up.
7. Lastly beware of Restrictive Title Conditions when purchasing a house. There’s a surplus of factors that one must consider before buying a house, and as a result, by the time buyers find the perfect house they just want to seal the deal. However, what is often forgotten is the important check of the title deed for any existing restrictive conditions - a potentially disastrous mistake for a couple who has ‘big’ plans for the property, having not beforehand familiarised themselves with the title deed. - Jaco Rademeyer
Article from property24
17th Feb 2016