Applying for a Joint Borrower Sole Proprietor mortgage (JBSP) may be a great option if your sole income doesn’t stretch enough to take out the mortgage you need alone.
To understand the lending criteria and conditions of a joint mortgage, it’s essential to seek the advice of a professional, such as The Mortgage Pod.
We are The Mortgage Pod, specialist mortgage brokers for Joint Borrower Sole Proprietor mortgages
Buying a home has never been more expensive, and sadly, getting on the property ladder is out of reach for many people. If that applies to you, don’t give up hope. There may be a chance you could qualify for a Joint Borrower Sole Proprietor mortgage.
There are a lot of essential details to understand about joint mortgages, so getting the advice of a mortgage adviser is a wise move. The Mortgage Pod can assess your eligibility for a joint mortgage and help you find a mortgage lender with the appropriate lending criteria.
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Is it worth getting a joint borrower sole proprietor mortgage?
The South Coast property market is diverse and can be erratic, but one thing is constant – compared to other areas of the UK, it’s expensive. Even with the option of 95% mortgages, getting on the property ladder is just not viable for many aspiring homeowners, especially young first-time buyers.
What is a Joint Borrower Sole Proprietor mortgage?
In a nutshell, this is where two or more borrowers come together to apply for a joint mortgage. Their combined incomes and deposits mean they have more borrowing power.
The borrowers share joint responsibility for the mortgage repayments, although only one is named on the title deeds as the legal owner of the property. This can be helpful for buyers whose income isn’t enough to secure the mortgage they need in their sole name but who have the support of a friend or family member willing to be added as a joint borrower. It’s similar to having a guarantor.
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Joint Borrower Sole Proprietor mortgages for first-time buyers
A Joint Borrower Sole Proprietor (JBSP) mortgage can be an excellent way for first-time buyers to get on the property ladder, as it can significantly increase their borrowing capacity.
The process is generally the same as for other buyers. However, a key difference is that first-time buyers can benefit from not paying stamp duty and other incentives. This can positively impact the overall cost of the property purchase.
When embarking on a JBSP mortgage, first-time buyers and non-legal owners must get legal advice. It’s also very wise to get the advice of an experienced mortgage adviser, like The Mortgage Pod.
What is the criteria for a JBSP mortgage?
Mortgage lenders consider all applicants’ income and outgoings, including existing mortgage or rent payments.
It’s important to note that the maximum mortgage term for a JBSP mortgage may be determined by the age of the oldest borrower listed on the application. However, this policy may not apply to all mortgage lenders.
Adding a joint borrower who is significantly older than the primary borrower can sometimes limit the mortgage term to the retirement age of the older borrower. This can significantly impact the amount that can be borrowed, as well as the monthly mortgage payments. Since the term would be shorter, monthly payments would be higher.
For example, if a 30-year-old applicant adds their 62-year-old parent as a joint borrower, they would need to pay off the mortgage by the time their parent retires.
How do mortgage repayments work for JBSP mortgages?
For Joint Borrower Sole Proprietor mortgages, all borrowers are jointly liable for repaying the loan, not just the legal owners. Each borrower contributes to the mortgage debt according to the terms established by the borrower’s or other agreement.
How can The Mortgage Pod help me get a joint borrower sole proprietor mortgage?
A joint mortgage can be an excellent option for many borrowers, but it’s essential to consider the pros and cons to determine if it’s the right choice for you. As your mortgage broker, we will ensure you understand all the options available to you, empowering you to make an informed decision.
As a mortgage broker, we are not tied to a particular lender and can source a suitable deal from various mortgage providers. We’ll also manage the entire application process to save you time and hassle.
Contact The Mortgage Pod today to find out whether you and a family member or friend could qualify for a joint borrower sole proprietor JBSP mortgage.
Frequently asked questions about JBSP mortgages
How many people can be part of a JBSP mortgage?
While many Joint Borrower Sole Proprietor mortgages involve two joint borrowers, some lenders permit up to four additional borrowers.
Can I remove someone from a JBSP mortgage?
It may be possible to remove someone from a JBSP mortgage if you can prove that you can now afford the mortgage on your own.
To remove someone from a JBSP mortgage, the lender must agree, or a new remortgage application may be required.
It is important to keep in mind that removing someone from a JBSP mortgage may have legal and financial consequences. This includes tax considerations and potential penalties for violating the mortgage agreement. It is recommended to seek professional guidance before deciding to dissolve a JBSP mortgage.
The Mortgage Pod is not authorised to provide tax or legal advice.
How do JBSP mortgages differ from guarantor mortgages?
A guarantor mortgage involves a third party (the guarantor) providing additional security for the loan, typically property or savings. A Joint Borrower Sole Proprietor (JBSP) mortgage allows multiple borrowers to collectively secure the loan, with only one person being named on the title deeds as the legal owner of the property.
Can a married couple get a Joint Borrower Sole Proprietor mortgage?
Married couples can be considered for a joint borrower sole proprietor mortgage. Couples may consider this type of mortgage for tax efficiency, estate planning strategy or asset protection.
How to get the best JBSP mortgage deals
To get the best mortgage deals for your circumstances, it’s always recommended to seek the advice and recommendations of a professional mortgage broker like The Mortgage Pod. Contact us today and let’s find you a competitive JBSP deal.