Well yesterday we discussed how difficult it can be to merge finances as a couple. It appears to be increasingly difficult as you get older. Even harder to navigate is whether to buy a house together. At around 30 whether you are single or not, it seems many people get bitten by a bug to buy a home.
But the question is how do you buy a house together if you are an unmarried couple? The simplest route and one which I took is buying the house 50/50. Where both people put down approximately equal amounts and each pay 50% of the mortgage. Then if you split up, the house is split 50/50.
However the real trouble arises when there is a disparity between the couple regarding the down payment and affordability. K mentioned that they were in negotiations for how they will manage buying a house together as an unmarried couple. First problem is her BF will be supplying 90% of the DP, and she will supply 10%. This is causing a bigger problem because they have to negotiate all details in a written agreement because her BF's DP is a "gift" from his parents. Hence they need to settle what they are going to do.
BF wants the equity to be split on DP. But K wants to keep the equity she pays down because she'll be paying 50% of the mortgage. So I'm not sure what they are going to do. Because financially this is not just a business transaction, it's a relationship. I can see both sides of the argument, BF is taking more risk in buying the home by putting more money down. But K is also taking risk and she's paying down equity so she wants to keep her dollars.
But what is the answer? I guess we'll have to see what they decide to do. My advice? Don't buy the house, just get married then buy the house and it won't matter.