A joint mortgage is a home loan that is taken out by more than one person. Both parties will be mentioned on the paperwork. This type of mortgage could be taken out by any combination of two or more people. It is common for married couples to have a joint mortgage, for example, but the loan could equally be taken on by family members and even friends. Business partners might also co-sign a mortgage application if they wish to buy a property together as part of their business ventures.
Having a joint mortgage means that both people share the responsibility for making the monthly payments. This means if one person does not or cannot meet the repayments, the bank or building society can ask the other person to pay them instead. Both are responsible, yet if one disappears for any reason, it could potentially leave the remaining party in dire financial straits.
There are several reasons why joint mortgages can be beneficial compared to solo applicants for a home loan. The main reason is that when two or more people apply for a mortgage, the income of both will be considered when calculating how much they can borrow. There are many cases where one half of a partnership (whether in marriage or otherwise) could not afford to buy a property alone. However, when the income of both partners is included, a purchase becomes affordable because of the higher figures involved. This means even lower-income families can often afford to buy when it would otherwise be impossible.