Millennial money: How to share a deed on a home without an ‘I do’

Ask the Expert Buying Spring House Hunt
A sold sign outside a home in Mt. Lebanon, Pa. Buying a home for the first time is challenging no matter your marital status. But doing so in an unmarried partnership poses unique challenges. Gene J. Puskar/Associated Press/File

My partner had a goal: He wanted to be a homeowner by 30.

A natural at saving, he built up a down payment throughout his mid-20s. I, on the other hand, always struggled to save. That put us in very different financial positions when it came time to buy a house.

We were committed to sharing the road ahead, but without rings or legal documents tying us together, we wanted to take a smart approach. So we talked through our finances and took steps to protect our individual investments.

Our story is hardly uncommon for our generation. Nearly 25 percent of homeowners ages 18-34 purchased a house with their current spouse before marriage, according to a 2013 study from Coldwell Banker. That’s in contrast to just 14 percent of those 45 or older.

Here’s how you can do the same.

Understand each other’s finances

Chances are you and your partner aren’t in exactly the same financial situation. Maybe one of you earns more or one has a delinquent account or two lurking on credit reports.

Talk through the financial aspects that determine how much house you can afford: income, savings, debt load, and credit. Know where each of you stands to get a picture of how you’ll both contribute.

Make sure you’re on firm financial footing with a stable income, advised Gregory Thedford, certified housing counselor at Money Management International, a nonprofit credit counseling agency.

‘‘I would advise a homeowner to be at a job for a year or more before buying a home,’’ Thedford said. Having a stable income will help you manage the regular expenses of homeownership.

Build up your down payment

The biggest challenge many people face is building a down payment.

Talk it over with your partner. Will you both save, or is one going to put up most of the money? My partner and I went the latter route.

Many lenders prefer a 20 percent down payment, but that’s out of reach for many first-time buyers. My partner ended up putting 3 percent down for our home, and we’re not alone: 67 percent of millennial home buyers put down less than 20 percent, according to a 2019 survey by Clever, a real estate service.

For help building a down payment, look into your state’s first-time home buyer programs. Many combine grants for down payments with lower interest rates.

There are trade-offs to a smaller down payment: You’ll probably face higher upfront fees and monthly payments, as well as costs like mortgage insurance. For tips on how to buy a home when youdon’t have enough saved up, go to

Clean your credit

While you save a down payment, work to improve your credit profiles. Lenders prefer a credit score of at least 630, Thedford said. Borrowers with scores of 700 and higher get better rates.

Clear your credit reports of negative marks if you can. Delinquent accounts can make you look risky to lenders. If you see mistakes on your reports, such as an account that’s not yours, dispute them with the credit bureaus.

Lower your debt-to-income ratio by paying down accounts like credit cards. Carrying a lot of debt also makes you look risky.

Work out an agreement

Unmarried couples don’t have the same protections in the event of a separation as our ring-clad counterparts. To make up for this, having a legal agreement before mortgage papers are signed and cash changes hands is important, said lawyer Katherine O. VanZanten who practices in Portland, Ore.

‘‘Meet with an attorney and put everything in writing while everyone still gets along,’’ VanZanten said. ‘‘Talk about the basic things of who’s putting in the money and who’s responsible for what. This includes mortgage payment, property taxes, utilities, etc. What happens if someone doesn’t pay? What happens if you split up or someone dies?’’

The lawyer can walk you through legal concepts like tenancy in common or joint tenancy, which have different ownership implications. There are many ways to split things, VanZanten says. Now that we’re in the house, my partner and I plan to meet with an attorney to create an agreement.

There’s no ‘‘right’’ way to set up your arrangement. Since my partner had the down payment and home buying was his dream, he’s on the papers. We split the mortgage and utilities.

My takeaway is that home buying is about working together to achieve shared goals — and knowing how each party can contribute. We couldn’t have done this without each other. He had the down payment, but our joint income makes it affordable month to month.

No matter how you approach it, make sure both you and your partner feel good about your agreement.

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