When you start looking at applying for a mortgage, usually we find that the large majority of applicants in relationships will jointly apply for a mortgage, rather than applying for a mortgage in one of the couples sole name.
With property prices always on the up and inflation pulling ahead of wage increases, lenders will generally prefer that first-time buyers in Sunderland have two incomes to cover the mortgage if they have the option to do so, rather than both of them living there and only one person being responsible for the mortgage.
On the flip side, sometimes you might find that situations come up that may potentially make it viable for a sole name to apply for a mortgage. This can be down to anything from one of the applicants not wanting to have their name on the mortgage, to a financial issue coming up.
We also see in some cases, that one of the partners may not be in work in the moment, be that a choice or down to circumstance.
When we say financial issues, this could be something like a bankruptcy or county court judgement, factors that could affect the other applicant and also their overall chance of obtaining a mortgage. In these cases, it’s much better that there be no tied finances and that only one of the parties apply for the mortgage in their name.
Definitely make sure you’re careful, as one half of a couple getting into trouble financially can significantly harm the other half in their attempts to apply for credit, especially something as large as a mortgage loan.
For the most part, the rule of thinking to stick to is that the maximum borrowing capacity for a couple with only one applicant in employment will be lower than it would’ve been if the applicant who is employed had applied in their sole name.
This is something that happens on a regular basis across the mortgage world the mortgage world. Age is something that may also be factored into working out how much you can borrow. This may become prevalent in the event where maybe an applicant is over 50.
To use an example of how this would affect your mortgage; Let’s say you are over 50 and your partner is in their late 20’s, early 30’s. They have a well paying job and have plenty of time to pay off a mortgage before they hit your age. If they applied in their sole name, they may very well have access to a much higher mortgage amount.
The effects of stamp duty or something else relating to tax may be a potential reason as to why a couple may choose to only have one of them apply for the mortgage in their own name, rather than as a couple.
You’ll find that there are a fair amount of lenders with strict criteria regarding married mortgage applicants, as it is a mortgage that will be involving two people who are connected in a strong way. Whilst applying under a joint name gives security to the lender in the event of arrears, it can have its problems.
The reason for this is that if you happen to get divorced at any point down the line, it’s a difficult process trying to remove one of your names from the property. Our team of mortgage advisors in Sunderland can help with this, but you should definitely give plenty of thought before jumping in headfirst with your partner.
Luckily for those applying for homes, not all are as strict and prepare for the worse, so there will be options out there for you to choose from. We have specialist mortgage advisors in Sunderland, available every day of the week to help you find mortgage success.
We’re proud of the level of service we are able to provide home buyers and homeowners alike, so please do book yourself in for a free mortgage appointment and we’ll see how we can help!