In this guide, we look into joint mortgages and whether you can add someone to your current mortgage.
The good news is that, yes it is very possible to add some to an existing mortgage. However, there are some factors to think about before you do.
Can you add partner to mortgage?
Yes, you can add a partner to your mortgage. However, it will depend on them being able to satisfy the mortgage lenders affordably criteria.
Who else can I add to my existing mortgage?
Below we look at the people most commonly added to a current mortgage.
- Most people that want to add someone to an existing choose their partner. They are usually in a relationship and are often married or in a civil partnership.
- You might want to add a parent to your mortgage, especially if you need their financial help when making your monthly mortgage payments.
However, you do need to be aware that there may be a few costs involved.
Costs for adding some to a mortgage
The costs involved when adding someone to a mortgage are:
You might not be asked to pay stamp duty if you’re adding somebody to your mortgage, but your current lender might charge you an administration fee to make the relevant change.
Early repayment charge
You might also need to pay the early repayment charge set by your lender if you decide to switch lenders early and add the other person’s name to your mortgage via a remortgage.
There will be legal costs too as you will need a solicitor when working out the terms of your joint agreement.
These expenses suck but when it comes to fees, know that you won’t be charged by our team of mortgage brokers if you come to us for advice on joint mortgages.
Is adding someone to a mortgage a good idea?
Whether adding some to a mortgage is a good idea or not really depends on your personal circumstances.
If you’re struggling with your financial commitments and need the support of another person, then adding them to an existing or new mortgage can be a good idea. It can also be a good idea if you want to give your partner a share of your home.
However, when you make this new financial agreement, the partner’s credit will be associated with yours.
This is known as Association of Credit and it will be added to your credit file. If the other person’s credit history is fine, then you have nothing to worry about. But if they have a bad credit score, this will impact your creditworthiness and you may struggle to remortgage or borrow money in the future. This is something to consider not only when thinking about joint mortgages but when thinking about opening a joint bank account too.
If you’re thinking about adding a partner to your mortgage, you also need to consider the strength of your relationship. If you were to ever break up with them (or vice versa), your life would be made complicated because they would have a share of the property. As such, it is wise to seek legal help before you decide on a joint mortgage and consider transferring equity.
How do I add somebody to my existing mortgage?
If you would like to add someone to your mortgage, your first port of call is your existing mortgage lender. They may agree to add an additional party to your mortgage but they are more likely to ask you to consider a remortgage instead.
Regardless of the options before you, your lender will need to check the person’s credit history and run an affordability check on them before making a decision.
Is remortgaging a good idea?
Remortgaging can be a good idea, especially if you’re coming to the end of your mortgage term, as you may be able to get a more affordable fixed-rate deal.
This applies whether you’re wanting to add someone to your mortgage or not, as you will avoid your existing lender’s standard variable rate if you opt for a remortgage when your current mortgage term ends.
If you are thinking about remortgaging to add a parent or partner to your mortgage, more deals may open up to you due to the addition of the other person’s income.
However, you should be cautious if you’re still midway through your loan term. This is because you may be subjected to your lender’s early repayment charges if you exit early.
In such a case, it might be simpler to add another person to your mortgage if you are given the option to do so.
What if my lender doesn’t let me add someone to my mortgage?
Adding someone to your mortgage isn’t a straightforward process as your existing lender will need to carry out their credit and affordability checks. This applies whether you’re adding someone to your existing agreement or making a new agreement with a remortgage deal.
If your existing lender says ‘no,’ perhaps because your partner’s credit score is poor or if your partner has other debts to pay, you shouldn’t panic. There are many other lenders out there, including specialist lenders, who may be willing to offer you a joint mortgage with another person.
To find another mortgage lender, you should speak to a broker such as ourselves. We will search the market for the lenders more likely to offer you a joint mortgage and will let you know which lenders are offering the better deals.
Remember: You will need to pay the early repayment charge set by your lender if you exit your mortgage term early, so it’s often wiser to wait until nearer the end of your term before switching lenders.
What are the tenancy options when adding someone to a mortgage?
When adding another person to a mortgage, you need to decide how the ownership of the property will be defined. It’s vital that you take legal advice before deciding on an option as there are wider implications for you beyond having another person to help you make the mortgage payments.
There are two tenancy options for somebody wanting to add another person to a mortgage.
- Joint tenants
- Tenants in common
‘Joint Tenants’ is often the best option if you want to put your partner’s name on the mortgage and title deeds.
This is because you will both have equal rights to the property and if it ever got sold, you would both be able to claim an equal share of the profits that come from the sale. This would apply whether you’re still together or are separated from one another.
In the sad event that one party dies, the deceased person’s share of the house would automatically pass to the other person. As such, neither of you can leave a share of the property to somebody else in a will, which is either a pro or a con, depending on your personal feelings.
While ‘Joint Tenants’ is a good option, you do need to be aware that you may lose out on any money you invested in the property before your partner started to make their contribution. This is because they are entitled to an equal share, so if you were to break up with your partner, you wouldn’t necessarily be entitled to the most money if you decided to sell the property.
To get around this, you can ask a solicitor to draw up a Deed Of Trust that outlines the rights and responsibilities of both parties and the amount of money (such as that equal to your deposit) that should be returned to you after the property sale. If you do ask a solicitor to draw up a Deed Of Trust, you will, of course, be subjected to their legal fees.
Tenants In Common
With ‘Tenants In Common,’ two people can be on the mortgage and the property deeds but the share in the property doesn’t have to be divided equally.
So, if you spent several years paying off the loan by yourself and wanted to own a larger percentage of the house, this could be the option for you.
However, if you decide on the ‘Tenants In Common’ option, you need to know that you could face problems down the line.
This is because this option gives the other person the right to sell their share of the property to somebody other than you after a breakup. As such, you could end up owning the house with a complete stranger!
The same applies if one party dies as their share of the house wouldn’t automatically result in a transfer of equity.
It is possible to avoid such scenarios but the legal process can be complicated and you will need to pay a solicitor for their legal work.
Therefore, you should think carefully before deciding on ‘Tenants In Common’ if you want to share a mortgage. While you would be entitled to a larger percentage of any profits made from a house sale, you wouldn’t own the whole property if the other person sold their share or left their share to somebody else in a will.
Do I have any other options?
In most cases, a joint tenancy where both you and the person own an equal share is the most straightforward route to go down. However, it is still worth debating the pros and cons of each of the options we have discussed, so speak to a solicitor for advice and check out our guide on joint mortgages for more useful information.
These aren’t your only options, however. You could also ask the other person to make a financial contribution to your household costs without putting them on the mortgage. This way, you wouldn’t be affected by their credit rating if it was particularly low and they wouldn’t have any claims to your property if you ever decided to cut ties with them.
For some people, this is the easiest and most straightforward option.
But if you do want to add somebody to your loan agreement, you will need to consider the options we discussed previously.
Can I add a friend to my mortgage?
A question our mortgage advisors are often asked is “can I add my friend to my mortgage?”. It is our experience as a mortgage broker that adding a friend to your mortgage should be done with caution. This is because being financially tied to a friend is a big step and we have observed that it can end in tears! It wouldn’t make sense to add a friend to your mortgage if they have their own mortgage as there will be tax and stamp duty implications when owning two properties.
We have come across many situations when a friend eventually wants to buy their own home and no longer wants to be joint tenants with you. Quite often it may not be able to take them off your mortgage so they become trapped. We have observed that when this happens things can turn nasty quite quickly seeing them seek legal advice!
Can I remove somebody from my mortgage?
Adding someone to your mortgage can be complicated but removing them from the mortgage and the property title can be even harder. This doesn’t mean it’s impossible, however.
If you get to the point where you do want to remove somebody from your mortgage, you should speak to your current mortgage lender. They might be able to remove the other person from your mortgage agreement although they would need to know that you have the means to pay for the mortgage alone.
If your lender wasn’t willing to remove the other person, they might suggest a remortgage. This may give you enough funds after equity release to pay for a new mortgage deposit and to buy out the other person from their share of the property.
But while remortgaging is one way forward, you would still need to pass the lender’s credit and affordability checks. If there are problems with your credit report or if your income has dropped since taking out your original mortgage, you may not be eligible to remortgage and this could make the process of removing the other person harder. The same applies if your home is in negative equity.
For more advice, speak to one of our mortgage brokers and we will discuss your options with you.
- We also recommend our guide to joint mortgage separation which contains detailed information on your mortgage options after a breakup.
- Our advisors believe that another guide that could interest you is to learn about joint borrower sole proprietor mortgages.
How a mortgage broker can help
If you would like to add somebody to a mortgage, get in touch with a mortgage advisor from our expert team and get professional advice. After meeting with you, your appointed representative will determine the best course of action based on your own personal circumstances and advise you further.
If your current lender won’t add someone to your mortgage or let your remortgage, we will search the market on your behalf for the mortgage provider that is more likely to offer you fixed-term deals on a new joint mortgage (provided you meet their credit checks and affordability assessment during the mortgage application process).
Should you decide to make the switch to a different lender, we will help you with the mortgage application, liaise with your solicitor and other third parties, and give you all the mortgage advice you need.
Please note: As mentioned, you may incur an early repayment charge from your existing lender if you do decide to remortgage and break your mortgage term early. As such, switching lenders might not be a sensible move if you are going to face hefty exit fees.
Waiting until nearer the end of your mortgage term might be the best course of action before approaching a new lender but we will discuss the pros and cons with you to help you make the right decision.
Get in touch with our fee-free mortgage advisors
As a mortgage broker, we have over 40 years of experience adding someone to a mortgage. Our observation is that it is essential that both parties realise that it can be a long-term commitment and works best when they are a family member. Our expert mortgage advisers are on hand to help you work out if adding someone to your mortgage is the right thing for you and also what mortgage lenders would look at your individual scenario.
If you’re looking for mortgage advice and support, give us a call or message us on WhatsApp and we will book an appointment with a mortgage advisor.
As a whole of market FEE-FREE mortgage broker, there will be no charge to you when you use our services.
So, whether you’re a first-time buyer wanting to make a joint mortgage agreement with somebody on your first property or a homeowner who already has their own property and who wants to add a parent or a new partner to a mortgage, get in touch and we will give you advice and support for FREE!