"For those in a stable relationship, a joint mortgage is a great way of navigating the current tricky marketplace, but it isn’t without its own complications"
Last year saw 338,900 first-time buyers approved for mortgages with around a quarter of the total applying on dual incomes. But mortgage broker Choice Finance is warning those thinking of sticking out a bad relationship just to get on the property ladder that they are running their risk of wrecking their credit history.
Choice Finance believe potential home-owners should be aware that by entering into a joint arrangement, both parties are severally liable. If things turn sour and one party stops paying their share of the repayments, a lender will still demand the full monthly amount from the other party. Any missed or late payments show up as black marks on both credit reports.
Matthew Pennell, Managing Director of Choice Finance, said: “For those in a stable relationship, a joint mortgage is a great way of navigating the current tricky marketplace, but it isn’t without its own complications and should not be entered into lightly.
“When applying for a mortgage together, both sets of credit ratings are taken into account and what some applicants might not realise is that their partner’s history will follow them if they ever look to borrow money again. If your partner hasn’t been upfront about their spending, it could drag your name through the mud in the eyes of lenders.
“In the event of selling a house when a joint mortgage is in place, ordinarily the profits will be split equally. Obviously, this can seem very unfair if one person has upped and left and not contributed to repayments. Sadly, in those circumstances, you may have to employ legal assistance to level the playing field. Not only is this time consuming and expensive, there’s no guarantee the courts will settle in your favour.”
