If a bank denied you for a home loan because you weren’t financially strong, you may want to consider a joint venture together with a family member or friend in the same circumstances. With your combined financial resources, you’ll have a higher chance of being approved by a lender. If you and your roommates decide to co-buy a property together, at least you’ll minimize the typical adjustment period associated with a new co-owner.

One scenario to consider is purchasing a property with individual units like a duplex or triplex. You’ll enjoy some of the same benefits as your own home such as a private entrance, separate kitchen, and more. While this arrangement may seem advantageous, you’ll still have to address the issues of joint responsibility regarding ownership and monthly maintenance expenses for the land, roof, and other common areas.

Another less costly alternative is to purchase a single dwelling and share the space together. One major problem with this arrangement is you would have to sacrifice your own private space. If you and the co-owner still decide to enter into this kind of arrangement, try buying a home with a layout that allows you separate private areas.

It’s important to spend time discussing some key financial issues and issues unique to co-ownership before you jump feet first into a co-buying situation. One vitally important concern will be how the down payment and monthly expenses will be apportioned. Are you going to divide everything evenly or will you divide everything on a percentage based on the amount of down payment invested, the size of bedroom assigned, or other criteria? A good idea is to check with a tax professional on how your arrangement will affect your tax situation.

Another significant concern is what happens to a co-owner’s portion of the property when he or she dies? Will his or her heirs have rights to it? How will you deal with circumstances where one co-owner decides to move out-does he or she have the option to sell his or her portion of the home, require the other co-buyers to buy his or her portion out, or force the sale of the property?

Taking proper title to the property can have major consequences when not done wisely. It’s best to seek the advice of a trained attorney before deciding on what kind of ownership to list on the deed. Some popular ways to list ownership on a deed are joint tenants with rights of survivorship or tenants in common.

Some additional concerns that should be addressed are what length of time does everyone plan on staying in the property (and what are the options when one owner gets married or their parents need extended care); how will the common areas be maintained (cleaning, home supplies, music volume, and overnight guests); decorating the house, and what happens when one owner gets into financial problems.

Co-buying a house is a major decision that requires the right co-buyer to be successful. Make sure you spend quality time discussing all these important issues with your partner and solidify it with a legally binding contract drafted by an attorney.

Learn more about Tustin homes for sale. Use these local Tustin Realtors and see what they can do for you.

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