Should I (housewife) be on the mortgage agreement?

Lionel_Thinkbag

Lol, I've just realised how oddly phrased the thread title is.

We're FTBs, saving up a deposit, but I'm a stay at home mum. We don't have a joint bank account, my only 'income' personally is child benefit. Neither of us have any debts or bad credit etc.

When it comes to a mortgage application, is there any point in me being on it? I'm planning to continue being SAHM for the forseeable future, and although I may get a job at some point it's doubtful that I'll be earning anywhere near what my husband earns.

Can someone tell me the pros and cons of my being on the agreement? Would the fact that I have no real income or savings of my own (deposit is in my husbands account) count against us or hold things up in any way?

BitterAndTwisted

You not having any income will probably reduce the amount you might be able to borrow in total. That's all.

Annabee

But isn't it better for her if the OP's name is on there? In case anything were to happen in the future, like separation from her husband, etc.

ging84

generally the less people named on a loan the better
if your income does not contribute to the affordability, why would you want to expose yourself to the liability of the debt?

Annabee

So is being on the mortgage a separate thing from being part-owner of the house or not? If yes, fine, but otherwise I'd be worried. Because she doesn't want to find out in 15 years time that the house belongs solely to her husband/partner, does she?

I'm sure he's a lovely bloke, but if anything were to go wrong, that puts her in a weak position, right?
(Sorry OP!)

anselld

Annabee wrote: »

So is being on the mortgage a separate thing from being part-owner of the house or not? If yes, fine, but otherwise I'd be worried. Because she doesn't want to find out in 15 years time that the house belongs solely to her husband/partner, does she?

I'm sure he's a lovely bloke, but if anything were to go wrong, that puts her in a weak position, right?
(Sorry OP!)

It makes no difference. They are married so all assets are treated as jointly owned in the event of divorce, regardless of who is named on the title.

Nynaeve

At the time my husband and I were buying a house, I hadn't been in my job long enough to be considered on the mortgage application. However, I am on the deeds for the house. I make a financial contribution to the mortgage.

Like the others have said, it may reduce your affordability in the eyes of the bank, could this be a solution for you?

princeofpounds

Yes, being on a mortgage is different from being on the title of a house.

However, mortgage companies may not want to lend to someone if there is another person on the title. It complicates their ability to repossess the property in the event of a default.

ValHaller

ging84 wrote: »

generally the less people named on a loan the better
if your income does not contribute to the affordability, why would you want to expose yourself to the liability of the debt?

While that may be very valid for unsecured loans. it is completely misleading advice for 'being on the mortgage'.

The real issue is not 'being on the mortgage' anyway. It is about being on the deeds of the house - and normally you cannot have the one without the other. Being on the deeds means that you share in any increases in the value of the property and it gives a lot of protection. OP is a stay at home mum. If there were a relationship breakdown, OP might be retain the home if she retained custody of the children - until the oldest is 18 - then she will be out if she is not on the deeds. It also puts the children in the position of being pawns in battles over the property.

OP, for get about thinking whether you should be on the mortgage. Think about whether you should be on the deeds. I would usrge you to go on the deeds, which will put you on the mortgage.

kingstreet

Good luck with finding a lender who will allow more owners than there are borrowers. How would a lender repossess a property if someone owned it who was not party to the mortgage deed?

Lenders use affordability calculators to work out the maximum you can borrow. A non-working spouse is treated as a dependent, along with any children and many lenders will reduce the amount they will lend accordingly.

However, many take child benefit and tax credits into account and they will only do that if all the people named on the award letter(s) are also applicants for the mortgage.

Richard_Webster

Lenders use affordability calculators to work out the maximum you can borrow. A non-working spouse is treated as a dependent, along with any children and many lenders will reduce the amount they will lend accordingly.

That is logical, what is not logical is when lenders will lend to just the working spouse but not to both, even though the income and expenditure will be exactly the same- do they think that the non-working spouse mysteriously disappears?