Joint Mortgage on a Flat
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Joint Mortgage on a Flat
Sam Bull explains how a joint mortgage on a flat works.
Can I get a joint mortgage on a flat? How does it work?
Yes, applicants can get a joint mortgage on a flat, whether it’s a residential mortgage or a Buy to Let mortgage. Both applicants need to be named on the joint mortgage application and both will need to provide the necessary paperwork.
What deposit do you need for a joint mortgage on a flat? How much can I borrow for a joint mortgage on a flat?
Mortgage lenders can consider as little as a 5% deposit for a joint mortgage on a flat, although some may need a 10% or 15% deposit. This really will vary depending on the lender.
It’s worth noting that for joint mortgages on new build flats, different deposit levels may apply. Usually lenders want a 10% deposit in that scenario.
In terms of how much you could borrow, mortgage lenders generally consider lending up to six times the joint income, although this will depend on your individual circumstances and also your outgoings. Up to six times the joint in income is what we can usually aim for.
What eligibility criteria do we need to meet for a joint mortgage on a flat?
The mortgage lender’s eligibility criteria would apply to both applicants on the joint mortgage, but it would be no different to the eligibility criteria when applying in your sole name. It’s the same age requirements, employment details and credit history details, whether you’re applying individually or in joint names for a mortgage on a flat.
How is a joint mortgage on a flat split?
Most applicants for a joint mortgage on a flat will buy the property as joint tenants. This means that they both have equal rights to the whole property.
Some people, on the other hand, prefer to buy the property as tenants in common, which means you can each choose the percentage share that you own of the property. That might be better for people who are each putting in different deposit amounts.
Can I get a joint mortgage on a flat as a First Time Buyer? Do both buyers have to be First Time Buyers?
Mortgage lenders are happy to offer joint mortgages on flats to First Time Buyers. This would just be a standard joint mortgage application.
Most lenders would need both of you to be First Time Buyers to qualify for a First Time Buyer product range. Some mortgage lenders only need one of the applicants to be a First Time Buyer to qualify.
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Everyone’s different. You might be self-employed. You might have some credit history issues – whatever your situation, we will find the most suitable product available to you from across the whole market.
What if I have bad credit? Can I still get a joint mortgage on a flat? What happens if one person defaults on a joint mortgage?
Mortgage lenders will assess both applicants’ credit reports for a joint mortgage application, so if one applicant has bad credit we would request copies of both credit reports to see what the issues are. We can then recommend a suitable mortgage with a lender who can accept the bad credit.
Only one direct debit is set up on a joint mortgage, and if one person doesn’t pay, or they default on the mortgage, it will affect both applicants’ credit reports.
How does remortgaging a joint mortgage work on a flat?
This would be a normal remortgage. Both applicants would need to provide information on their income, expenditure, their credit reports and ID, payslips and bank statements.
But really there’s no difference remortgaging a joint mortgage on a flat than a sole mortgage on a flat.
What are the benefits and downsides of a joint mortgage? Are there any differences when looking to purchase a flat?
The main benefit of a joint mortgage is the potential to get a bigger mortgage by using both applicants’ incomes. Because there’s more income, we can potentially get a much larger mortgage.
The main downside to a joint mortgage would usually be if one of the applicants has bad credit. That would affect the whole application, and the mortgage would be more expensive in terms of the interest rates you’d qualify for.
There are no differences in that aspect, whether you’re purchasing a flat or any other type of property.
How do you apply for a joint mortgage on a flat? What’s the process?
We would carry out an initial fact find with both applicants for the joint mortgage on the flat. We would then request the documents, such as proof of income, and get information about your expenditure and credit history.
We would then be able to advise how much you can borrow, what deposit you’ll need, and how much the new mortgage will cost.
What else do we need to know about a joint mortgage on a flat?
It’s always worth working with your local mortgage broker, especially one who has experience in arranging mortgages on flats. If you provide all the information up front, being as accurate as you can, you should be able to get yourself that joint mortgage on a flat with no issues.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP WITH YOUR MORTGAGE REPAYMENTS.
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