Co-owner, co-signer or gift?
There are three common ways family helps with a home.
- Co-owner: you're both on the title and the mortgage. You share the home and the responsibility.
- Co-signer or guarantor: they back your mortgage but may not be on the title. If payments are missed, the lender can come to them.
- Gifted down payment: a close family member gives you money toward the down payment. Lenders usually want a signed gift letter saying it never has to be paid back, and they'll want to see the money in your account before closing.
Two ways to hold title
- Joint tenancy: you own the home equally. If one owner dies, the others automatically own their share.
- Tenancy in common: shares can be unequal, like 60/40. If one owner dies, their share goes to their estate.
Which one fits depends on your situation. Your lawyer can explain the difference before you close.
Put it in writing
A co-ownership agreement, drawn up by a lawyer, saves a lot of arguments later. It should cover:
- who put in how much at the start
- how the mortgage, taxes, repairs and bills are split
- who lives in the home
- what happens if someone wants out, can't pay, or wants to sell
- how you'll value the home if one owner buys out another
How the mortgage works
The lender looks at everyone's income, debts and credit. Everyone on the mortgage is responsible for the whole payment, not just their share. If one person stops paying, the others have to cover it.
First-time buyer programs with more than one buyer
The FHSA and the Home Buyers' Plan are per person. Each buyer who qualifies can use their own. If only one of you is a first-time buyer, ask your lender how that affects the 30-year amortization and other first-time buyer rules. My first-time buyer guide covers each program.
Homes that work for more than one household
If you're buying for several generations, look for a main-floor bedroom and bathroom, a separate entrance, and enough parking. A legal secondary suite gives everyone more privacy. Check that any suite has the right permits before you buy.
Not legal or tax advice. Talk to a lawyer about title and your agreement.