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  • Writer's picturePenn Financial

Mortgages | Joint Borrower, Sole Proprietor

Updated: Aug 8, 2023

Getting a mortgage is a life changing decision and a huge responsibility, banks do not give away money easily to anyone.

Sometimes, it can be easier to get a mortgage if you are married, or living together with your partner as you can potentially benefit from two sources of income, but what if that does not apply to you and you wish to get a mortgage on your own?

Trying to get a mortgage on your own can be challenging as you can only borrow so much as your lender deems to be affordable in accordance with their own affordability criteria. To compound matters, each lender has different affordability criteria.

What if the amount you can borrow is not enough?

You still have a number of options. One such option would be to wait for better times with more income and more savings under your belt which then puts you in a position where you could then afford to purchase the home you desire.

In some cases, you could turn to friends and family. Do you have a member of your family that could come for rescue?

If that is a yes, then you could possibly add somebody, say a family member, to the mortgage so that your borrowing capacity is increased because you can potentially benefit from some of that family member's disposable income. Please note that they then become liable for the mortgage and the mortgage payments if you default.

You could in that situation still own the property in your sole name, even though their name is on the mortgage.

Put it another way, you are jointly responsible for the debt -i.e. the mortgage, but you own the home.

This is known as a joint borrower, sole proprietor mortgage.

These types of mortgages are not right for everyone so before considering that as an option speak to us to get sensible and professional advice.

Please also note - You can reverse the situation. What if your parents, for example, would like to borrow against their property or they are coming to the end of their interest-only mortgage term and do not have sufficient income to enable them to do that? You as an adult child may be able to help them with their affordability criteria to enable them to potentially borrow what they need.

If you would like to know more about how you may be able to purchase that property you always wanted or to help your parents remain in their home where they are having mortgage issues, speak to your qualified mortgage broker or speak to me. I would be happy to help.

077 8026 8027

The information provided in this article is not intended to constitute professional advice and you should take full and comprehensive legal, accountancy or financial advice as appropriate on your individual circumstances by a fully qualified Solicitor, Accountant or Financial Advisor/Mortgage Broker before you embark on any course of action.

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