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We had a nice nest egg pre-wedding, some was spent on the wedding, but the chunk that was left was for a home. We didn't end up finding the right one until after the wedding, though, so that's when we bought the house...about 6 months after the wedding.
Looking back, though, we would have tried to watch our pennies on the wedding just a bit more because it would have been that much more to put towards the house. Especially seeing some of the bee budgets, there are some things I think we paid way too much for.
We began the homebuying process before we were publicly engaged. (Though, of course, we knew.) We completed the purchase of the home a month after our official engagement, and are going to be married a little over a year after we bought the house.
FI and I were independently saving money for two years with a vague idea in mind that we'd need it for something major, and that ended up comprising our down payment. We are incredibly lucky to have generous parents who are paying for the wedding.
Don't get downhearted, the first-time homebuyer's tax credit that was passed by the government last winter is being renewed for another year, and you are allowed to use the money for your downpayment! That's a fat $8,000 toward a down payment. If you have clean credit, you can get an FHA loan at only 3% down, so hopefully that eight grand tax credit would be enough to cover your down payment.
Good luck!
how can you use that tax credit towards a downpayment?
how does that work?
We were engaged for a year and a half, and bought our house during that time. Like Lillindy, we had a good nest egg saved up that we put on the downpayment on the home, since that was more important to us than the wedding. Then we created an account and started saving for the wedding. We both thankfully had well paying jobs at the time, so we were able to do both without it being too painful.
That said, we had a lot of PB&J lunches last year!
We've owned a home together for about 4 years now and have been dating 9 years. So it was definitely before engagement and to us it was definitely something that just made sense rather than throwing our money away. Which is what we think renting is....alot of renters we know are paying more for rent than we are on our mortgage!
I think the best thing you can do is to walk into a couple banks and sit down with their mortgage consultant and see how much you can get preapproved for.
Best of luck!
I don't own a house and I'm not married... but I thought I might answer anyways because I'm in the same position you are. I'm engaged and we plan to buy a house before the housing credit expires at the end of april 2010. We're planning to be married in january 2011.
Basically, I have 10K saved (plus an emergency fund that i don't touch) and FI has 0 after the purchase of my ring. We plan to use the 10K + 8K as a down payment on a house. For the wedding, we are keeping our budget low and only spending what we are confident that we can save between now and january.
Would I like if we could spread them out a little to make it easier? Absolutely. But I"m not going to miss out on 8K free from the gov't and I"m not going to postpone marrying my FI... sometimes you gotta roll with it.
We bought our house early in our engagement. I thinnk planning and buying a home would be way too much to handle. They are both pretty stressfull and time consuming. As far as the tax credit you buy the house and then on the next years taxes you claim the money there. So you don't actuaaly get the money until AFTER you buy the house.
We were engaged in August & just bought our first home. We qualified for the $8000 tax credit; which we will claim on our income taxes & hopefully get our refund then. You CAN apply to get it before you purchase to use towards your downpayment. However; it's more of borrowing it. I don't know all the nitty gritty about it; but it sounded like they would loan in now and then they would take more taxes out of your check each week to pay it back until income tax time. Something along those lines. So it IS possible to get it sooner for your downpayment; but there is some fine print along with it. As far as I know right now; you have to be Closed on your home by December 1st; enless they've extended it (which they've discussed). As far as Buying our Home and Wedding Planning. We have done minimal wedding planning because we we're very anxious to buy a home. We have our date set & I've bough my dress...... But we are waiting until Spring 2011 to get married so we have left ourselves plenty of time!!
We bought our house 2 years before we got engaged... I couldn't imagine dealing with that stress at the same time as dealing with all of the wedding planning and my school work!
we both had 'starter houses' (AKA, not the ones our kids will graduate in ) ;)
I had mine before I even knew DH, and he bought his while we were "just dating". We now live in his and rent mine out. I know people do not like to move a lot, but it might be better to get a house that is "good enough" for the next 3 years but not your dream home. Then, you can utilize the Fed. gov't offer but not take too much risk financially.
We started looking at houses early 2009 but not really seriously. We got engaged in June this year and bought the house at the end of August. I had a good chunk of downpayment available so that helped and he put in some money to help too. We are happily moved in and having our housewarming this Friday.
Luckily my parents are paying for most of the wedding but it is hard to decide, do we put that $100 towards the house improvements, of the $100 for the wedding/honeymoon.
You can use the tax credit for the downpayment, but you have to find a lender that will help you. From what we heard this is really hard to do since a lot of people are trying to do this and banks aren't lending as much right now. We just decided to fork over the cash for the deposit and enjoy the nice rebate check when it comes in.
Just so you guys know, you can't file your federal income tax return to get the tax credit before you purchase the house. The state may give you the credit for a downpayment, I've heard that some states do but I'm not sure which one.
We bought a house 2 years before we got married. I had money from a life insurance policy that I was able to use as a downpayment. But now we can't sell it even though we don't live there anymore because we would lose a lot in the sale.
We purchased our condo before the wedding. We got engaged in March of '08, found our condo the end of April, and closed on it July of '08...then just got married this past September '09.
I'm not going to lie - it was a lot and it was stressful. Mr. S had just paid for my ring, and while he had a good paying job, that was still a lot of money to go out at once, and then to have a downpayment to come up with a few months later. We had been saving thinking we might buy a place, but we found our condo much faster than expected. AND this was before the any of the first time buyer tax credits. After the fact, we did qualify for the $7,500 tax credit that we will have to pay back, but it's been a nice little nest egg that we've used when we relaly have to, and then replenish when we can.
My parents helped us with an interest free loan for part of our downpayment, but we still had to come up with around $12K. And they paid for half of our wedding, but we still ended up spending about $10K for the wedding out of our own pockets. In the mix of all of that, Mr. S was laid off this past April and has since started his own business, which means just months before our wedding, our income was impactd a lot!
Long story short, I'm so glad we did things in the order that we did, but they are all BIG decisions and you really have to be ready for the financial commitments. Especially if going from apartment living to owning your own place...it sucks when something breaks and you have to fork over the money to fix it vs. calling your landlord!
On the flip side, it's great investing in a home together, and also fabulous to be registering for gifts that you will use in your current home together!
And they did extend the credit into next year. You will get the full credit if you buy before April 1, 2010 but it is phased out after that until the end of 2010.
We actually just closed on our townhome the beginning of this month and so far it's been amazing! My FI had money saved for his contribution of the wedding and part of the down payment before we got engaged. I began seriously saving for our wedding and downpayment a few months before we got engaged.
One major thing we did to be able to save for the wedding and buy a place was we decided to scale back on the engagement ring budget so we could still buy a home in the future and not dig too deep into his savings. So basically, we sacrificed a huge ring by cutting the ring budget in half but I still LOVE my ring and am soo happy we decided to do that. It meant I didn't have to wait longer for a bigger ring, or hurt our downpayment/wedding budget. And now that we've qualified for the tax credit we'll be good to go.
The type of loan we qualified for only required a certain % of a down payment, and we decided to buy a place that is about $40,000 less than we qualified for. We didn't want to be "house poor" especially since this will most likely be a starter home for us.
Since we still have a little less than a year out for the wedding, we'll still be able to save more for our contributions for the wedding. I doubt if my parents weren't paying for the bulk of the wedding if we'd have been able to do both. Obviously, we're not married yet...so hopefully our saving habits won't change until then!
We singed the contract for our house about a month and a half before our wedding last year, and closed a little over 3 weeks later--2 weeks before the wedding! I would not recommend that tight of a schedule to anyone if you can avoid it--it was crazy and hectic and VERY stressful. However,we really wanted our own house by the time we were married, and just didn't find the right one sooner! And I am SO glad we found it when we did, instead of stopping our search and settling for a rental we would have been miserable in.
DH had saved up quite a chunk of money before the wedding, so we had a decent down payment and money for the wedding with an emergency fund left over. I'm not sure what we'd've done if he didn't have that. And at the last minute, my parents made us a very generous gift towards the downpayment, so in the end we put about 7% down.
Considering the housing market in our area, we didn't feel there was a good chance prices would go up significantly in the first few years, so we actually decided not to buy a "starter" home, and instead get somehing we'd both feel comfortable in for the next 10-15 years if necessary--we didn't want to be trapped in a too-small house that we couldn't resell. While we still paid well below what the banks would qualify us for, we were on the top end of our own comfort range and compromised a bit on location (further out but still a nice neighborhood) to get the size we wanted. We'd still love to upgrade in 5 years or so, but it isn't *necessary*, and we love our current house.
I firmly believe that you should put SOME of your own money down, do not rely only on the tax credit, because it will make you feel and act more personally invested in the purchase. As for the mortgage, 30-year (or less) fixed, absolutely--don't mess with variable rates right now. you can always refinance later if they drop. I think most finance gurus recommend no more than 30% of your PRE-tax salaries be spent on housing (mortgage, mortgage insurance, and homeowners insurance). We are at about 25% and even that sometimes feels like a stretch. Also, you really need an emergency fund to protect against job loss for any reason (laid off, serious injury, etc) -- don't drain your emergency fund for a down payment! 3-6 months income is a good goal, but don't sweat it if you can't sock that much away right away--just set aside SOME money for this apart from your down payment. I also think a starter home right now is not the best idea, and that you really really should love whatever you buy, because you may have to stay there a long time. Don't settle! Good luck!
Before!
I couldn't imagine doing both! We bought our house 2 years ago and are getting married next summer!
I own a home and FI own a home...after marriage I am moving to his home b/c it's bigger and he makes more....and I am thinking about going back to school full-time after marriage.
In order to save for my downpayment and things I would need after closing (mini-blinds cost a small fortune b/c I have so many windows) I stopped eating out for lunch and dinner and cooked more. I only shopped for neccesities. I severely cut down on road trips (it used to be nothing for me to gas up my car, pack up my daughter and go somewhere for the weekend). I started saving the day I moved into my daughter and I moved to Charlotte after I got a job offer and saved for the next 3 years. It was tough but worth it to have walls I could paint and my own fresh carpet to roll around on, and a backyard for my daughter to play in =)
We bought our house about a year before the wedding. We didn't put a huge down payment, only 3% because we were first-time homebuyers. It means our mortgage payments are higher, and we have to pay PMI (mortgage insurance--you have to pay this if you put down less than 20% until 20% of the principle is paid off). We got to take advantage of a tax credit, at the time it was $7500, so that was a huge incentive to buy. There is another one available now; I think it was just extended until April.
We purchased our home before the wedding, too. Got engaged in January 09, closed on our house in April 09 (didn't move in until summer...lots of renovating!) and just started planning the wedding 2 months ago in September for September of 2010.
We saved for a few years and think it has really kept the stress factor down. We put almost 25% down on our house, he paid for my ring in full and we've been making monthly payments on all the wedding related items so that by the time the big day comes everything will be paid off, no credit card balances, etc. It's hard at first, but once you start saving and seeing the numbers in your account grow, it kind of becomes more of an incentive to save more and more and more. We have a few different bank accounts, but one we have $20k sitting in as an emergency fund. No matter what, I/we will not touch it. Not even to "borrow" from and pay back right away. I have moved the money to a credit union out of state and didn't even get an ATM card for it. We've almost forgotten about it, but it's nice to know that if something happens, it's there...
So many relationships suffer because of financial stress and with the country's economic status, we wanted to be a bit more financially secure before the wedding date. We'll be together for 5 years + by the time of the wedding.
I already owned a house when we became engaged. We'll buy our first house together next year :)
We got engaged in April of 2008, began looking for condos in June 2009, put our bid in Sept 2009, closed on October 2, 2009 and got married October 17, 2009. I would never recommend that to anyone! It was way too stressful - especially because we had to be out of our apartment September 30th and were without a place to stay for 2 nights (we rented a hotel room and left ALL of our belongings locked in a U-haul in my Aunt's driveway) so I was crazy stressed that our closing actually happen on the 2nd. Otherwise we would've had to have rented the U-Haul for longer, stay in the hotel longer, and have my parents come some other time b/c they were coming to help us paint and move in.
We put down 3.5% for a FHA loan - and like Mrs Mouse, have to pay a PMI - which I think is about $75-$100/month? - for the first 5 years of the loan. We also worked it out that the sellers paid $10k in closing costs. If you can negotiate this, it will cut down on the money you have to bring to the table.
We'll be planning a wedding and buying a home together (my second home, so don't think we'll qualify for a first time home buyer's credit). The plan is to close on the new house shortly before the wedding and Mister and his boys will move into the house and me and my kiddie crew will move out of my house (which I'll rent out) and move into the new house with Mister and the boys upon our return from the honeymoon.
I might be a little bit biased, because I work in the banking industry (at a Credit Union)... but if at all possible, use a Credit Union. CUs are much more financially stable, don't do high risk lending and in most cases have money to lend!!!
@91011Bride: They changed the tax credit so that now if you have lived in the same residence for 5 of the past 8 years you qualify for a credit up to $6,500 (10% of purchase price). This is only until June 2010 though.
We closed on our house the week before our wedding... it was an it tough, especially as I have my own business (ie. smaller income)! We scrimped and saved as much as we could, and DIY'ed or did away with a lot of 'traditional' parts of the wedding. We also lived with his parents for 8 months to help save-up, which was a *huge* help. And received a few surprise contributions to our wedding along the way.
Looking back I wish we'd spent a lot less on the wedding (it's only one day!) so we'd had more towards the house... including all the 'surprises' you find once you move in (we bought a 30 year old home which needs some tlc).
We did house then marriage but I'd just say not only to save up for buying but to have a little nest egg just in case something goes wrong with the house, which happens from time to time.
I currently own the townhouse we live in and we hope to sell it and buy a new house before our ceremony in August. My FI owned a home previously and still has the money from its sale. Combine that with the money from the sale of my townhouse and we should have a 20% down payment. He paid for the ring, I am paying for the wedding and we should have savings left over. I think we are fortunate that we've both been out of college for 10+ years, which means lots of years to save.
I second @bvig about the nest egg. You should assume you have to have your insurance deductible handy, in case there is roof damage or something else, like I had!
We bought (and built) a year before we got engaged (and had been living together for two years already at that point). We saved like maniacs in order to have a 10% down payment and we are SO thankful that we did. Our mortgage payments are much lower than our friends' who put down 5% or less.
I'm very happy that we weren't building at the same time we were wedding planning, as it would have been throroughly overwhelming. Having said that though, I feel like building our house was great training for wedding planning in that both involve having to make a TON of decisions in a fairly short amount of time.
We bought a home together in 2008 and qualified for the $7,500 tax credit (that we will have to start paying back when we file our 2010 taxes). The tax credit makes up almost 75% of our wedding budget. We saved every cent 2 years before we bought the house, but were very lucky to be able to live at home with our parents, which was how we were able to save so much money. We had to make a lot of sacrificies, but it was all worth it in the end. I am also a big believer in saving the difference between your current living expenses and what they will be when you buy a house. In other words, if you are paying $1,000 a month for rent, but a mortgage would be $2,000 a month, then you should be saving $1,000 a month for a down payment. This way you know you can afford the house you buy, and you end up with a very nice down payment. I think I got the idea from Suze Orman.
I owned my house before my husband and I met, and we are living here until we can pay down some bills and start saving for a better down payment. My house is small, but my house pmt is only $400 a month and in a few months both our cars will be paid off and then we can start working through our debt before we buy a new home together!!
We closed about 2 months before the wedding. Setting aside the craziness of moving in the month before our wedding, it was a great decision.
We were extremely fortunate that my parents paid for our wedding (minus incidentals, rings, and honeymoon).
We had the money for the downpayment from some savings as well as from a lawsuit settlement (DH was in a terrible car wreck and broke his back two years ago when another driver fell asleep at the wheel.) Anyways, that's how we did it.
we bought the house last october (2008) and our wedding isn't until NEXT june (2010)!
we decided early on we wanted to buy our house way before the wedding and not deal with doing both at the same time. We also knew we wanted a "starter house" and we will eventually buy our "30+year house" once we have kids.
I love our house. It's a cute little bungalow - 2 bedrooms, 1 bath, basement, yard and private deck with attached garage. It's only about 865 square feet on the ground level and a little more in the basement. It's not nearly as large as some of our friends' - but we also only pay $600 / month for our mortgage!!!! We found the "perfect" house for only $72,000.
Since our house was only $72,000 AND we got the seller to pay the closing costs - our down payment was just only over $1200, if I remember - we were pretty lucky it wasn't too much and we had been saving for a few months.
Now - one thing we really didn't pay attention to, however, during the inspection was some issues that have cost us some money. When we first moved in - we didn't realize that our electrical system was alllll sortsa fubar. We ended up spending around $3000 after we moved in to have an electrician come in and fix a lot of things. So the absolute first piece of advice - especially if buying an older home (ours was built in the 40's) - is to absolutely pay attention to your inspection!!! If there's something wrong - have whoever you're buying it from fix it first.
Now we have put some money into our house - new fence around the yard (and the yard's a whole other story we will be putting money into eventually...) - brand new screen doors on the breezeway - we redid some of the trim in the living room and bedrooms - we've had to replace a few of the appliances that the house came with and had to put in a brand new air conditioner as the old one didn't even pass inspection.
SO - the BIGGEST word of advice - on top of having $$$ for your down payment - you MUST have some $$$ for the first few months put away for little things you'll find here and there that you want to upgrade, replace or fix.
I can't tell you how much $$ we spent at lowes just in our first two months here alone! lol
but it was all worth it. :) again - we're not spending the rest of our lives here - especially since this is in the indianapolis public school district, and we both specifically want our kids to go to a township school...but it is the perfect little "starter" home. :)
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did you buy your home together before or after the wedding?
if you were buying a house and planning a wedding at the same time... how did you come up with a decent deposit while waiting to spend every spare cent on your wedding?!
Just wanting some guidance/advice/ or your experience on first time home buying while wedding planning