Joint Mortgage Application

starM

Hi,

My 2 sisters would like to apply for a joint mortgage. The reason being one of my sister cannot apply for the mortgage just in her name because she never had credit previously and she is only 19 years old but in full time employment.

My other sister had credit for number of years now and has excellent credit history - again in full time employment.

Is it possible they have a joint mortgage now and then they change it to sole name after 6 months?

Thanks
MS

MrSilk

Don't think so. Both of your credit records would be taken into account and you won't be able to amend loan after 6 months

pinkteapot

No. Sister who wants to have the mortgage alone after six months would effectively need to re-apply for a mortgage in her sole name. She'll be assessed on whether she can afford it as any sole applicant would be.

The house deeds have to match the mortgage. In this scenario, they would both be named on the deeds and the one being removed from the mortgage would also have to be taken off the deeds. Have they talked about what they'll do if the house value has risen or fallen in those six months?

starM

That's what I thought so but this advise was provided by a mortgage adviser.

pinkteapot

Hmm, I may well have been wrong then as the broker should know better than me. My understanding was that if you have a joint mortgage and want to remove one person from the mortgage then the other person has to qualify for the mortgage by themselves. It's the same situation as when a couple splits up...

Goldiegirl

starM wrote: »

That's what I thought so but this advise was provided by a mortgage adviser.

They could apply for a transfer of equity, to transfer the mortgage and the property to the sole name of the sole sister - but the application could easily be declined, of the lender thinks the sole sister couldn't afford the mortgage on her own, or failed their underwriting criteria.

There would be no guarantees that the application would be approved.