New Visitors Privacy Policy Sponsorship Contact Us Media
Baby Boomers Family Green Home and Auto In Critical Condition Just Starting Out Lifestyle Money
- advertisement -
Bankrate.com
News & Advice Compare Rates Calculators
Rate Alerts  |  Glossary  |  Help
Mortgage Home
Equity
Auto CDs &
Investments
Retirement Checking &
Savings
Credit
Cards
Debt
Management
College
Finance
Taxes Personal
Finance

 

Should newlyweds buy a house?

Page | 1 | 2 | 3 |

2. Resist the urge to splurge.
If you're looking forward to buying a home within a year, don't take out loans for that new "now-we're-a-couple" car, an expensive suite of furniture or trendy weekend toys such as motorcycles.

- advertisement -

Aside from the fact that you'll need extra money for your home down payment, mortgage lenders don't like seeing new debt on your credit report.

"You don't have a reliable record of payment for a new car, for instance, so you're in a riskier category financially," says Patrick.

3. Manage your moves.
If one of you is moving to a new job or changing careers, sit tight on the house purchase for three to six months. A stable employment history is important to mortgage lenders.

If you move to a new city after you get married, consider renting for a year before you buy a house, says Patrick.

"It can take a while of actually living in a new place before you know which neighborhoods are the ideal ones for you," he says.

Save, save, save. Even if you need to put contributions to your retirement plan on hold, this is the time to sock away cash. Patrick likes couples to have at least three months of expenses stashed in an emergency fund (in savings or a money-market account) in case one partner loses a job, gets ill, becomes pregnant, etc. You don't want to lose your house when an unexpected financial crisis hits.

It's also smart to save up a hefty down payment. The more you pay upfront on your house, the smaller your fixed monthly payments will be. You may also be able to eliminate the cost of private mortgage insurance, or PMI, by putting down at least 20 percent of the house's cost.

4. Get pre-approved before house-love hits.
Bernard won't show clients any houses until they've had a serious sit-down with a mortgage lender, even if it's not the bank or broker they eventually use.

"It's just awful to see a newly married couple get their heart set on a particular house, only to find out afterward they can't afford it or they're not creditworthy enough for a decent mortgage," she says.

"I insist that they take care of the boring financial details first," says Bernard. "Once they know they're qualified for a home loan and know how much they can afford to spend, they're free to focus on the more emotional side of the transaction -- finding the house they love."

5. Research mortgage deals.
Even if you've had your checking account at Stable Mega Bank since your college days, you don't necessarily want to get a mortgage there. Mortgages are very competitive financial products these days and you might not get a better deal at your current bank just because you're already a customer.

 
 
Next: "Their first home is usually not their forever home."
Page | 1 | 2 | 3 |
 
 RESOURCES
Get our free mortgage newsletter
Here comes the bride's name change
Using a HELOC for an emergency fund
 TOP MORTGAGE STORIES
Winner or loser: Mortgage shopper
Winner or loser: Home equity loans
Winner or loser: Auto loans
 

Mortgages
Compare today's rates
NATIONAL OVERNIGHT AVERAGES
30 yr fixed mtg 4.12%
15 yr fixed mtg 3.14%
5/1 ARM 3.25%
Rates may include points
RELATED CALCULATORS
  Calculate your monthly payment  
  How much house can you afford?  
  Fixed or adjustable rate: Which is right for you?  
VIEW ALL  
FINANCIAL LITERACY
Rev up your portfolio
with these tips and tricks.
- advertisement -
- advertisement -

About Bankrate | Privacy Policy/Your California Privacy Rights | Online Media Kit | Partnerships | Investor Relations | Press Room | Contact Us | Sitemap
NYSE: RATE | RSS Feeds |

* Mortgage rate may include points. See rate tables for details. Click here.
* To see the definition of overnight averages click here.

Bankrate.com ®, Copyright © 2014 Bankrate, Inc., All Rights Reserved, Terms of Use.