Buying a home with someone else could make the deposit and other costs easier to manage. A mortgage lender may also consider your combined incomes, which could increase how much you can borrow.
However, a joint mortgage creates a shared financial commitment. Everyone named on the mortgage is responsible for the repayments, regardless of how you agree to divide them.
Before applying, discuss ownership, credit histories and what would happen if your plans changed.
What to consider before applying
Combine your buying power
Lenders may consider multiple incomes, helping you borrow more than you could alone.
Choose how you will own the home
Decide whether owning as joint tenants or tenants in common better reflects your plans.
Check every applicant’s finances
Income, debts, spending and credit history can all affect the mortgage application.
Plan for future changes
Agree what should happen if someone wants to leave or can no longer contribute.
See what you could afford together
Add both incomes to get an initial estimate of your borrowing range.
Who can get a joint mortgage?
First-time buyers and home movers can apply with a partner, friend or family member. Married and unmarried couples can apply, alongside people buying with friends or family.
Everyone must pass the lender’s affordability and credit checks. Each applicant’s income, spending and debts will affect the overall mortgage affordability assessment.
Applying together also creates a financial association between your credit files. As a result, one applicant with bad credit could affect the mortgage decision and everyone’s future borrowing.
How many people can be on a mortgage?
Most joint mortgages have two applicants, although some lenders allow up to four people to apply together.
Applicant limits and income rules vary. A lender may accept four applicants but only use the two highest incomes when checking affordability.
Age rules differ too, as there is no single joint mortgage age limit. The oldest applicant’s age could affect the mortgage term available.
A mortgage broker can compare lenders based on how many people are applying and which incomes they will consider.
Choosing how to own the home
Your mortgage and property ownership are separate. The mortgage shows who is responsible for the debt, while the property title shows who legally owns the home.
In England and Wales, joint buyers usually choose between joint tenants and tenants in common. The options and process differ elsewhere in the UK, so ask your conveyancer which rules apply.
Feature
Joint tenants
Tenants in common
Ownership
You have equal rights to the whole property
You each own a set share
Ownership shares
You own the property together, without separate shares
Shares can be equal or different
If an owner dies
The property passes automatically to the surviving owner
The share can be passed on through a will
Often chosen by
Buyers who want equal ownership
Buyers who want separate or unequal shares
When buying as tenants in common, you can use a deed of trust to record each person’s deposit and ownership share. You can also set out how to divide the proceeds when you sell.
Joint mortgages with parents
A joint mortgage with parents allows the lender to consider your combined incomes. As a result, you may be able to borrow more. With a standard joint mortgage, everyone named usually shares ownership and responsibility for the repayments.
The lender will review each person’s income, spending, debts and credit history. In addition, a parent’s age could shorten the term available and increase your monthly mortgage repayments.
What is a JBSP mortgage?
A joint borrower sole proprietor mortgage includes another person’s income in the application. However, that person does not own the property. Parents often use this arrangement to help their child purchase a home.
The supporting borrower takes responsibility for the repayments without owning a share of the property.
Not every lender offers JBSP mortgages, and the rules vary. A mortgage broker can compare the options available to you.
Ownership may affect Stamp Duty or the relevant property tax where you live. Ask a conveyancer what applies before choosing either route.
Applying for a joint mortgage
Start by checking your combined budget and agreeing how much each person will pay. Review your credit reports too, as any mistakes could affect the application.
For a joint mortgage application, each person must provide ID and details of their income, spending and debts. The lender uses the information to decide how much you can borrow.
An Agreement in Principle can give you an idea of what you might borrow together. Although not a formal mortgage offer, it can help you set a realistic budget.
After the seller accepts your offer, your broker or lender can submit the full application. The lender will check the documents and arrange a property valuation before making its final decision.
Set your property budget
Get an early indication of what you could borrow together.
Can one person pay a joint mortgage?
A joint mortgage paid by one person is possible. However, everyone named remains responsible for the debt. Any agreement between you does not change who the lender can ask to pay.
If the person paying falls behind, another applicant may need to cover the missed amount. Late or missed payments could affect everyone’s credit history.
Before relying on one income, check that you could still afford the mortgage if rates or household costs rise.
Leaving a joint mortgage
Moving out or separating does not take your name off the mortgage. You could sell the home, keep paying together or ask to move the mortgage into one name.
Taking over the mortgage alone may require a transfer of equity. The lender will also check whether the remaining borrower can afford the repayments alone.
Everyone remains responsible until the lender agrees to the change. Speak to your lender or broker early and get legal advice before changing ownership.
How Muttuo Mortgages can help
Joint mortgage criteria vary between lenders. Parents, larger groups and applicants with past credit issues may face extra checks.
Muttuo is a whole-of-market mortgage broker with access to over 100 lenders. We can compare your options and help you choose a suitable mortgage. We will also guide you through each stage of the process.
Muttuo Mortgages can help you:
✓
compare mortgage rates, fees and lender criteria
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check your combined affordability
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review options for parents and multiple applicants
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prepare and manage your mortgage application
Ready to explore your options?
Speak to Muttuo for help finding a joint mortgage that works for everyone involved.
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Your lender may repossess your home if you do not keep up with your mortgage repayments.
