Are you and your boyfriend planning to buy a house together, in both names? That is more worrisome to me. Do you plan to make a downpayment?

Yes in both names, I'm not looking for a lecture on how thats a bad idea though because he may not be my "fiance" but he is, we are planning together far in the future and our relationship is stable. I'm not sure how the fact that we aren't married is going to affect the loan, the loan itself might end up in one person's name but the deed will have both our names on it. We are shooting for a 5% down payment and probably a 3/1 ARM since we will only be living there for 4 years.

I thought I'd heard that w/ points, etc., you should buy a home figuring you'd need 5 years to recover all the lost $ from points, realtor's fees, interest paid, etc. Since one can't count on sharply rising market to add equity value.

"the loan itself might end up in one person's name but the deed will have both our names on it"

Don't think you want to do that. That would mean that both of you own it, but only one of you would be responsible for paying for it. Could be a messy situation if the unthinkable happens.

And talley sue makes a good point. You should do some calculations to see if buying a home when only expecting to live in it a few years makes fiscal sense. Sometimes renting is the smarter way to go, depending on the location.

I don't think its a problem, putting one's name on the mortgage and both of your names on the deed. I did it with my "boyfriend" at the time and now 11 yrs later, we still have it the same way. I think you should speak to someone at a bank and explain your situation and they probably can help you and answer all the questions you may have.

I don't think it will be problem.....you might just need a co-borrower.

Good Luck~~
maria

I have never had a loan officer ask me what I was going to be doing in a year's time. They just took my current earnings statement

When I bought my first place, I did not have enough to qualify on my own. My parents co-signed and I got a roomate to make the mortgage work. Even then, my mortgage payment was about equal to my interest only student loan payment.

I would not suggest that you buy a house. Your finances will be so stretched anyrate if he is subsidizing most of his education with loans. You/he will end up with 6 figure loans by the time he graduates. People take many different types of loans. During residency, often the principle continues to grow on some of the loans. It's a scary situation....

Life is NOT fair but if someone has rich parents, they can buy you a property without blinking an eye. I know that many parents buy properties for their kids when they are in school because it's a better investment than paying their rent, if they are paying for it anyrate! Don't try to overextend your finances just because others are doing it or to keep up with the jones.

Owning a house means dealing with repair and maintenance, which costs money! When you have tests every two weeks in seven sujects that you are taking for the quarter, you do not have time to think about stuffed up toilet and leaky roof.

In third and fourth year medical school, you will have to be close to the hospitals because of the hours that he keeps. Often the students rotate to different parts of the country to "preen" for prime residency spots. I would not let a house keep me from making sure I get my dream residency.... There is so much up in the air about what specialty to chose, where to do residency, etc etc. Focus on school and his/your career rather than buying a house for now. Medical school and graduate schools are really for studying. If you are married and together in four years, I would think about buying a house while in residency where the committment is more secure and the future is more certain. For many graduate schools, you may be doing your research else where too. Don't tie up too much of your life before it starts.

This is my humble opinion which was not asked for.

The mortgage in one name but the deed in both is a bad idea and could put unnecessary pressure on your relationship.

I had a friend who had an issue with this a couple of years ago. Her fiance had bad credit so the mortgage was in her name. They had been together 10 years. She got badly burned.

Don't do it.

I don't think its a problem, putting one's name on the mortgage and both of your names on the deed.

It's not a problem if you stay together, obviously it can be a big problem if you split up. One person is legally responsible for paying the mortgage while the other person has a legal right to half the house, but no responsibility to pay.

I agree, I wouldn't buy a house while you're still in school particularly under the circumstances you describe with both of you being full-time students. Med school is tremendously stressful and very hard on all other commitments, and being locked into real estate will complicate internship choices, as well.

As a practical matter, I can forsee difficulties getting a loan (at a decent rate) unless both tenants in common (those with names on the deed) agree to the placement of the lien on the collateral and joint responsibility for repayment. While the loan might be based on the projected income (from whatever source) of one party, the lender would probably like the debt to be enforceable against all owners of the property.

For the record I have no issue (moral or practical) with a couple not being married while jointly owning property. My concerns are commiting to owning a house without an income stream except for borrowed money and scholarships. While home ownership (vs renting) is often described as a key to long-term financial success (and I agree it is, due to the effect of the tax code), without "real" income to protect from taxes you won't reap the same benefits. I doubt you could deduct mortgage interest against borrowed student-loan "income".

Give yourselves permission to just rent and let a landlord worry about everything else. Put your energies into studying and whatever part-time work you can fit in to reduce the amount you have to borrow to pay for school. That would be the best foundation to lay for your long-term financial future, IMO.

Molly~

I Moved to the DC area from Canada,thus no credit at first, thus only my wife's name is on the mortgage, but I am on the deed/title of the house. Wasn't a problem at all. Just the closing company had to be made aware of it.

"In third and fourth year medical school, you will have to be close to the hospitals because of the hours that he keeps. Often the students rotate to different parts of the country to "preen" for prime residency spots."

The location we are looking for is both close to the school and the hospital, since my program is in the hospital he will be doing rotations at in his 3rd and 4th year. I will be working after only one year, and the 6 figure loans he will have, he is going to have regardless of if he pays rent or a mortgage. We have one other med student already to rent from us and would be looking to have another, making our payments significantly less. I will be working in a year after buying the house. I have no problem renting for a year till my finances are more stable, but it seems that he and his father seem that buying a house is what they are determined to do. I reminded him of the repairs conflicting with tests, but he is dead set on buying the house. One option is to let him do what he wants and I can rent from him, but I am really ready to have my own place and to do it together.

With the blowup of the subprime market,banks and mortgage companies are reverting back to the"old" rules of lending,much more stringent, and the days of no down payment,piggyback loans,are disappearing quickly..I bet even with 5% down, you may have trouble getting a loan with the circumstances you noted...I'd rent...

Buy the property! You'll easily be able to sell (or rent) the property to the next batch of students. Just make sure to stay within your budget and remember your just buying a property that you would be otherwise renting (its not going to be your dream home), so keep the mortgage payment comparable to what you would be paying in rent. Keep in mind that you have to make income so that you can deduct the interest on your loan, otherwise you may as well be renting. You're property may increase in value over 4 years, but it probably wont be much considering the market we are in.

In my area renting is much, much cheaper than buying. I recently saw a rental listed at $1995/mo. That same home would probably sell for around $750,000, maybe more. And the taxes would be maybe $9000/yr. I'm guessing that the owners just wanted to rent it fast, probably for a single year...but still!!

So I would suggest you look at rentals and homes to buy before you commit to any course of action. Also - it may not be that easy to get renters. If I were a fellow student I woud rather be on equal footing with other renters (and have a professional landlord to deal with repairs) than live in "your" house. I would not be willing to pay as much to live with you.

Personally, I would rather have a nice apartment with a pool and gym than be sharing a place with other students and have to maintain it.

Speaking from a Lenders perspective: "next August in a city about 150 miles from our home at the moment." First question a lender is going to ask is "what job/employment will you have in this other city to repay the mortgage."

Loans are not income, and you will need income to qualify for a mortgage. Unfortunately, I think you will have a problem getting a mortgage.

I do think that many parents probably buy the property.

Red flag--he and his father?? Repairs--upkeep son or father- area--will they allow renters?? Sounds like renting would be advisable

If you really think you can afford it, buying is probably a good idea. My daughter and her husband did that while they were in grad school and it had a number of economic advantages. As for how the house is owned, yyou simply want to figure on a worst case and cover yourself. Couples split up -- including married couples -- and people die. You can protect both people by taking this into account and have a written agreement that is signed and notarized. It's also a good idea to have wills. I did that with my partner years ago when we weren't married. The agreement confirmed that the house was owned jointly and equally and that, in the event we split up, either person had the right to buy out the other based on an independent appraisal to determine the value of the equity. If neither party could afford the buyout, it was specified that the home would be sold and the proceeds would be split equally. The wills made clear that, in the event of death, the surviving partner would receive full title. If you think these things through in advance and put them in writing, then you avoid nasty surprises because the State can't force stuff to happen that you don't want to happen.

Andrea,

Marriage gives you some measure of protection in the eyes of the law. Without it, you will have very little rights without a well written contract done with a good lawyer.
At this point, without the marriage protection, I would consider your finances separate for big things, ie retirement savings, house purchases, and things that affect your credit because you/he have separate financial entity. If you have a life insurance, I would NOT make him my beneficiary. I would make my parents the beneficiary. When you marry, the finances merge whether you like it or not.

If you want a part ownership, you must write a good contract regarding a buy out as Kudzu describes. If he and his father want to buy a house and can qualify for a loan on their own, it's their house. If they NEED your income to qualify for a loan, I would insist on a part ownership with a buy out clause that is fair to everyone. You need to specify the percent ownership not just have your name on the deed.

Don't think of this as buying a house with a boy friend you may marry so you two can starting building a nest but as a business contract or an investment opportunity where all parties need equal protection. Until you get married, that's what this is. Yes, it's complicated. But you are asking for something complicated. Talk to a loan officer with your current income and see if you would even qualify for a decent house in the area that you are looking at. Unless you ask, you will never know. Dont' ask them to pull your credit report until you are ready because if they pull too many reports, it affects your credit score.