Co-Buying guide

Co-Buying Guide

OK, so you've decided co-buying is a good way for you to achieve your goal, whether that be as a first time buyer, a private investor or someone looking to co-buy a holiday home... well, the folks here at Co-BuyWithMe have created a co-buying step by step guide based on our own experience - we hope it helps!

1.   What sort of co-buyer are you?
2.   Who is your ideal co-buyer?
3.   First contact
4.   Keep the momentum
5.   Check 'em out
6.   Money time
7.   Lets get official
8.   House hunting
9.   Put the champagne on ice!
10. What happens after they ride off into the sunset - is that it?

1. WHAT SORT OF CO-BUYER ARE YOU?

Are you buying a property to live in, as a buy-to-let or a holiday home? How long do you want to own it for? When do you want to get your money out? What type of property do you want and where? How flexible are you on certain issues? These are some of the questions you need to ask yourself before looking into the possibility of co-buying. It seems like a lot but most of you will already have a good idea - the clearer you are about what you want, the smoother the co-buying process should be. To give you a head start here are some thoughts from our own experience..

"I chose to focus on two areas about what I wanted; the property and the money - what I could afford, this is how I broke it down:

Property:

- Had to be in near city centre for work reasons
- Good travel links - close to bus-stop or tube station
- Flexible on size and type of property - I just wanna own a home!
- Bonus is outside space...of any kind, but not mandatory for
  the right pad.

Money:

- I wanted to be equal to whomever I bought with - so I looked for
  co-buyers with similar size deposit and income.
- Wanted someone with a secure / stable job - or a trust fund!

After working out what I wanted from a co-buying partner when I posted my profile on Co-BuyWithMe - I pretty much mentioned all the above so others knew what I was looking for"

back to top

2. WHO IS YOUR IDEAL CO-BUYER?

You’re looking for a co-buying partner; ideally someone who shares the same thoughts and goals as you about co-buying (see step 1!). If they want to invest in a buy-to-let - maybe you can co-buy and be the tenant - but when will they want to sell? The more similar they are to you the easier it will be to co-buy, but be open minded you never know what opportunities there may be! Search our site, look for the right person - then the fun part begins - first contact! Below is an example from another co-buyer that might help:

"Once I knew what I wanted from co-buying I started thinking of the type of person I wanted to co-buy with. This is what I came up with:

- Clean!
- Physical age of no concern as long as they were of similar
  outlook in life as me.
- Same goals for co-buying, were they a FTB or an investor?
  I wanted a co-buyer to live with.
- Flexible & honest
- Had the same amount of deposit and similar income to me.
- And wanted the same things in the property as I did

Again, I noted most of that on my profile when I registered with Co-BuyWithMe so others knew whether they matched what I wanted and stopped unsuitable co-buyers contacting me"

back to top

3. FIRST CONTACT:

OK, there’s one basic rule and that is - be nice! This is a community built on values of honesty, flexibility and partnership so let’s keep it that way. Email potential co-buyers who look interesting to you and see who replies; create a checklist of questions to see if they are worth co-buying with (run through your position in steps 1 & 2). At this point we recommend you do not share any private information – instead make contact through the website’s anonymous email service. If you find a match - start talking!

back to top

4. KEEP THE MOMENTUM:

You've emailed each other a few times and things look promising, so you need to take the next step - the first phone call or first meeting. Now, we really have to emphasise safety at this point, prevention being the best medicine and all that, so, read our safety tips now! Nothing will probably go wrong and you may end up meeting not only a co-buyer but a friend for the future, but it’s best to keep our wits about us.

OK, why meet? Well over email you can work out whether you both tick each others boxes, but with any partnership you have to know you can live / work / invest with each other as people. So meet up, get to know each other a bit, see if you are of the same mind-set, do you think you would be able to compromise with each other, think of it as a first date; do they meet your co-buying buddy criteria?

Safety Tips Click Here

back to top

5. CHECK 'EM OUT:

You've met up and want to co-buy together but to ensure everything is above board it's worth doing a few checks on your co-buying buddies; financial and criminal. Now you can't get their information but you can obtain your own credit ratings and criminal records to show each other.

You get information on your credit report from a credit reporting agency. There are three big credit reporting agencies in Australia: Baycorp Advantage, Dun and Bradstreet and Tasmanian Collection Service - although there may be other credit reporting agencies in your area besides the ones mentioned above. You can get information on your criminal record - or lack of as the case may be at www.crimenet.com.au

If everything is cool – then it’s time to get a mortgage (although to save money the mortgage company will no doubt perform their own credit checks on you both - but not criminal records)!

back to top

6. MONEY TIME!

You’ve found your perfect co-buying partner, so now it’s time to become mortgage buddy’s! You may need a mortgage for 2, 3, 4 or more of you. Work out what you can afford and how much capital you will need. Don't start shopping till you know how much is in your pocket! Once you have a mortgage offer you can start house hunting – brilliant!

back to top

7. LETS GET OFFICIAL:

You've found your co-buying partner/s and now you need to sort out your 'Co-Ownership Agreement for Property' - this is a legally binding document to protect you and clarify your relationship, if you like, the terms of your co-buying partnership.

If you are wondering what sort of terms you should have - it will depend on what you are buying it for, but here is a few that we included:

- Decision making is equal
- All costs & profits are split equally
- Agree to live in the property for 2 years minimum.

If someone is desperate to get their money out before two years; they could offer their share to the other co-buyers. If they couldn't afford/want to buy it - the seller would be responsible for finding someone else to buy their share (which we all had to agree with - especially if they were to move in).

If however, after the two years one of us needed our money back and couldn't find a buyer, we all agreed to sell the house and quit while we were ahead so none of us would be restricted.

If you are buying an overseas home to use / as investment we had very similar terms as above but the period was increased to 5 years instead of two.

back to top

8. HOUSE HUNTING:

At this stage, you've met your co-buying partners, you've run through the terms, everyone has agreed and may be in the process of having the declaration of trust drawn up or you may be waiting until you find a property (if you are waiting - make sure that document is signed by everyone before you start spending money on surveyor fees, etc) We could be here all day on the house buying process, but needless to say thousands buy property every year and so can you!

back to top

9. PUT THE CHAMPAGNE ON ICE!

You've found your co-buying partner and are about to exchange on your property, you've checked them out, signed an agreement and are raring to go. Well, there's not much more I can say - you're about to get the key to your own front door and good luck to you!

But remember the Co-BuyWithMe.com philosophy - be honest, flexible and work together and we're sure you'll live happily ever after.

And don’t forget to tell us all about your co-buying success!!

back to top

10. WHAT HAPPENS AFTER THEY RIDE OFF INTO THE SUNSET - is that it?

Well not quite, you may find after your co-buying endeavour that in a couple of years you are ready to upgrade, or possibly want to get involved in property investment or a second holiday home... Well, start reading from the top and change your criteria - have fun!

back to top