Good idea...or bad....

Jenny · 07-13-2008, 06:30 PM

So, I am having a little bit of a dilemma and I was hoping to get some more opinions on the whole ordeal.

My best friend of 10 years, her 4 year old son and I are supposed to be moving in together. The original plan was for us to get a 3 bedroom apartment, split all utilities 50/50 and she was going to pay a little bit more rent on behalf of her son. Recently, Her mom put an offer saying that she would put down a big down payment on a house for the three of us BUT the mom wants her name on the house lease, as well as my friends and mine. Her mom says that there isn't a catch to it, She just wants to know that we can afford the mortgage and pay all the bills on time, I think a little differently.

I have gone over the pros and the cons of it all inside my head and I still haven't made a decision on if this is a good idea or not. I have never lived out on my own before so I am afraid that owning a home might be to overwhelming.

So, I want to hear everyones opinions, do you think I should just go for it? Do you think her mom might have other motives? Or should we just forget the whole house thing and just stick to moving into an apartment?

**hendricius** · 07-14-2008, 04:34 PM

I suggest you to move into the apartment. Your feelings show that you are not ready for an home yet. An house is already quite a huge investment, probably even for you although her mother pays. Do you want to spend your money into that house?

misterconductor69 · 07-15-2008, 03:42 PM

I agree with the boss above. At least with an apartment you know what your expenses will be for the duration of the lease and you can get out of both the apartment and the inter-relationship with your friend as soon as the lease is up. A house can turn into a money pit and you can't so easily walk away from it.

Yes, it's good to build equity rather than pay rent and this is probably a buyer's market right now but I'd advise you to get the apartment. And you don't even know for certain if you can live with them.

Also, if you did get the house with the friend's mom in on the deal that makes her a 1/3 owner unless you have a lawyer draw up a contract between you three specifying otherwise. Then there's what happens if one of you wants to end the arrangement and the other wants to keep the house, how much does the remaining partner pay the departing partner for the equity that has built up (that's the current value of the house minus what's left on the mortgage, both from having made payments and the fact that =hopefully= the house has increased in value while you've owned it). And what if the remaining person cannot raise the money, can they be forced to sell? Even with a contract spelling out all these things it can still take expensive lawyering to enforce the terms. It can get very complicated.

Get the apartment. If all goes well you can think about a house farther down the line.

Becky · 07-29-2008, 11:22 PM

I would definately go with the apartment route for a while at least. Look at the long term commitmet that goes along with the owning the house responsibility. With an apartment, all you have to worry about is the lease, once that is up, you can just walk right out. With the buying of the house, there's a whole lot more to it. You can't just walk away from the house, but you really could with an apartment. Say your lifestyle changes in teh next couple of years (marriage, job relocation, etc etc...) You need to think long term when it comes to purchasing a house.

Jenny · 07-30-2008, 11:23 AM

I know everyone is right with sticking to an apartment, The only thing I am thinking about is more space wise. Can 2 adults and 1 kid find a big enough apartment to live in??

misterconductor69 · 07-30-2008, 01:54 PM

Well sure. Bigger families than that live in apartments. Look on the bright side, if you get a 3 bedroom and the friend and the kid take 2 of them you can adjust the rent split accordingly which should make things cheaper for you than just 50/50.

Here's something else you should do for your own self interest. Go on your own and look at a few small 1 BR or efficiency apartments and see how much they are. Then make some allowance for utilities and other costs. EVEN if you have no plans to go that route I feel it's important that you know what the comparison is. Having a roommate, especially one with a child, has good points and bad points and if one of the good points is cost savings you need to know how much to see if it's worth it.

Jen · 07-31-2008, 12:05 PM

I agree with everyone else: stick to the apartment. Maybe make a list of pros and cons?

Apartment
+ You can walk away from the lease after a year if it doesn't work out or need a bigger place

+ You pretty much set your own expenses - if you want cable, you sign up for it. Want a landline? It's your choice. If you don't, other people (i.e. her mom) can't spring it on you

+ If any maintenance things go wrong, the apartment is responsible for making repairs (veresus owning a home, you're responsible)

There are plenty of large apartments. The last one I lived in was plenty big for two of us. Remember Chris's/"Nerex" apartment that he shared with (oh, shit, I forget her name)..? That was really big, and I remember he paid such cheap rent.

Speaking from personal experience - having 3 college roomies and moving out with two different boyfriends (and you know the back-and-forth of the last one), things can EASILY go wrong. Mortgages are so much bigger than a yearly lease. Shit, not to say "learn from my mistakes," but could you imagine if I had bought a house with the last idiot?!

I think home ownership with multiple people is just a scary idea (especially with her mom, who won't even be living there); I don't even know how friends do it. Maybe it's just me, but that's more along the lines of when you're legally married. There are just too many things that can go wrong.