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Building Wealth with your first home as a couple!

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Building wealth with your first home as a couple!

Great decision, you want to buy your first house and stop throwing your money away on rentals.  But before you jump into one of the biggest first purchases of your life, you may want to get your strategy down for long term wealth.  Purchasing your first home can be a crossroad to financial freedom, or a mortgage nightmare.  Let’s strategize!

  1. Saving cash with an FHA / VA / USDA loan. The government loves first time home buyers and wants to help them out as much as possible.  A loan with a low down payment, 3.5% with an FHA, 0% down with a USDA (rural) and 0% down with a VA (veteran) loan is a great way to save some cash.  You will need some extra cash towards home rehab, decorating and furnishing.  Remember, any loan under 20% down payment will require a PMI (Private Mortgage Insurance) which is insurance in case you default on the loan.
  1. Purchasing off one income. If you learn anything from this article it’s this point. You can purchase a home off of one partner’s income and still have both partners’ on the title.  My advice is to use the partner with the lower income to purchase your first home with an FHA or low down payment option.  Together you will have a reasonable mortgage and be able to put funds aside.
  2. Both parties can be on the title  Just because one partner has used their buying power to purchase a home, doesn’t mean both parties cannot be on the title.  Place both parties on the title so the home belongs to both of you.
  3. Turn first home into a rental. After at least one year (mandatory time to occupy a home with an FHA loan) use the other partner’s income to purchase a 2nd You can rent out your original property and move into your second home.  Remember to place both parties on the title for the second property as well.
  4. Wealth building begins. Use proceeds from Rental towards new mortgage.  You should try for at least a $300 spread between your first home’s mortgage and the rent you collect.   Now you are building equity / wealth with two homes.

Risks: Of course when you are dealing with real estate you have to examine the risks.  Make sure your starter home is located in an area with high rental demand, ie: high demand for school zones, close to business district, shopping and dining.  Also make sure you are purchasing a first home with a mortgage payment you and your partner can handle.  Vacancy months can happen with your rental and you may have to make two mortgage payments in one month.

Hope this article inspires any couples thinking of purchasing a new home.  If you have any questions or would like to see properties, contact me, Chris Waters at

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