The start of your mortgage journey involves finding a property and obtaining a mortgage, all this can be a daunting experience for many homebuyers, especially if they are First Time Buyers in Hull going through the process by themselves. As a Mortgage Broker in Hull, we have spoken to a number of homebuyers in Hull who have decided to purchase a property either with a friend or partner if they could.
A part of the process will involve the advisor conducting an affordability assessment in which they would ask about your current financial situation. This gives us an idea of the maximum mortgage amount you can borrow from a lender. If there are two applicants, lenders will factor in both applicants’ income. Thanks to two sources of income being on the mortgage, it can increase the chance of getting a mortgage offer.
Should you default, your co-borrower could also be responsible for the full mortgage, and vice versa. Following is a list of useful tips we encourage you to take into account when moving into a property with a friend or partner.
All this comes down to which lender you’re with, nevertheless, you will generally be able to co-borrow with up to four people jointly. As much as having more people who are involved can work well with having their application accepted, it is best to keep in mind that this does increase the likelihood of someone pulling out prior to the term ending. For this reason, you must be aware of the people you choose to buy a property with.
There is the opportunity to increase your mortgage later if you want to, but all parties must agree to this. With this in mind, it is best to plan in advance about your future and your plans for ownership of the property.
Joint tenancy is an alternative that is most popular with civil partnerships or married couples. Joint tenants are two halves of one whole, one borrower. Therefore, in the tragic event where one half of the party passes away, the property will be automatically granted to the other half.
Under the circumstances, where you are looking to remortgage or sell the property, both of you would have reached an agreement before continuing with the mortgage. A ‘Tenancy in Common’ can be an option if you and your co-borrower are friends or family. This means that you both own your part of the property.
You don’t need to split your shares equally either. Therefore, if you find that one of you is on a higher income, for example, one of you will own more of the property than the other. One benefit of being a ‘Tenant in Common’ is that you can have the freedom to act independently so it’s your choice if you want to sell or give away your share.
A mortgage lender will emphasize that all borrowers are jointly and severally liable. Due to this, you will be liable to keep up the payments if one person chooses not to pay their share of the mortgage.
If you’re looking to buy a home with your other, you never actually expect that you are going to split up before the term ends. It is a large financial commitment to make, let alone with someone else, and can be a complicated process if you want to make a change.
This can be even more difficult if children are involved because it is likely that one parent will stay with them whilst you are the one who will move out and find their own mortgage. Irrespective of whether you are staying or going, both parties will need the aid of Mortgage Advice in Hull to find a suitable solution.
Even if the person has been paying the mortgage with the input of their ex or not, this doesn’t change the fact that it was applied for in a joint name. This means that in the event of arrears, they will still chase both parties. Before removing your ex-partner from a mortgage, the lender will need to be sure you will be able to maintain mortgage payments by reassessing your income before they proceed.
It can be common for people to apply jointly for the second time with a friend, family member, or new partner, if they are, will find it difficult to afford a mortgage on their own. In this circumstance, it can be beneficial to obtain Mortgage Advice in Hull.
As mentioned, in the circumstance where you may end up divorcing or separating from your partner while on a mortgage, you are both still responsible for the property and its mortgage payments.
Firstly, you would need to get in touch with your lender if you were the one who wanted your name removed from your mortgage. You can’t just make an agreement between the two of you.
In the situation where you are looking to get a mortgage of your own, the lender would take into consideration the property you are currently tied to. Therefore, it’s important to make sure that you are removed from the previous mortgage.
Circumstances like these will require you to look at getting Mortgage Advice in Hull.
You will find that some lenders will be more generous than other when it comes to how much they will be willing to lend you. This is something your allocated Mortgage Advisor in Hull will factor this in when recommending the best mortgage lender for you to approach.