JRM SSB

Buying a house for renovation can be a big expense. Many people choose to partner up for financing. This has worked in the past, but it has its own, unique set of problems.

First of all, any time you are entering into an agreement between friends there is a chance of thing going awry. There are disagreements that you cant resolve, and when you mix in money things get messy. When partnerships break up there is no good way to resolve the issue of the financial agreement that the two of you have entered into.

Sometimes the partnership falls apart for a reason that isnt aggressive. One of you may lose your job, or get injured. It is harder to get angry at someone when they fail on doing their half of the bargain when the reason isnt of their own choosing.

There is a great need to make sure that you have a formal contract in writing. There can be no I put in the floor, so you pay more this month. You have to lay down the rules, and both sign the paper. Sometimes you may feel cruel and bossy by insisting on going by the rules, but it is the only way to ensure that the partnership stays equal. A 50/50 partnership can only happen when both parties follow the agreement set forth.

Buying a house with a partner might be the only way that you can buy a house. It might be financially appealing to you, and that is a good thing. Just keep in mind the negatives and try to be prepared going in. It is better to go into a partnership agreement capable of carrying 100% of the financial burden, that way it will be okay if the partnership falls apart for any reason.