We find that the vast majority of married applicants would much prefer applying for their mortgage jointly, as opposed to separately in their sole name. Property prices have often gone much beyond wage increases in recent years and a lot of the time, you need two salaries in order to qualify.
That being said, you may sometimes find that you are actually in a situation where one salary is enough to cover the amount that you are asking the mortgage lender to borrow. Additionally, an applicant may actually have their own specific reasons as to why they would rather apply in their sole name.
One of the reasons for a sole name mortgage application, could be that one of the couples has bad credit tied to their name, such as bankruptcy or perhaps a CCJ. This could be considered a specialist mortgage situation in Essex. This could prevent them from applying for a mortgage, even if they would like to.
In some of these cases, so long as the other half of the couple doesn’t have their own credit problems, they could still be able to apply for a mortgage in their sole name. This can also apply to business partners or friends.
The person who is eligible for a sole name mortgage would need to be wary of any future financial association with their partner. Any ties to them and their bad credit could affect your credit score drastically, lowering your chance of obtaining any future mortgage.
Other situations where one of the applicants may look to buy in their sole name, is if their other half happens to be unemployed for some reason.
As a general rule of thumb, couples where one half is unemployed, actually may have a lower maximum borrowing capacity than if the working applicant had instead applied in their sole name. We do find this situation coming up quite regularly.
Applicant age can also be a factor in how much you can borrow. If one of the applicants is young but the other is say, in their 50’s, a mortgage lender may be hesitant to lend as much, due to old age risks through their term (a 25 year term would take you to your 70’s!) and worries with income.
That being said, if the younger applicant were to instead apply in their sole name, there could be the likelihood of borrowing more and benefitting from a wider variety of mortgage lenders and mortgage deals.
You may also find that there could be related tax implications or even stamp duty, which could lead to one half of the applicants instead looking at their options for applying for a mortgage in their sole name, rather than with a partner.
Depending on the circumstances you find yourselves in personally and financially, many mortgage lenders can be strict and for security in payments, can be much less likely to lend to married applicants in their sole name, if they otherwise would have a partner to borrow with.
You may also find that mortgages can be much more complicated if couples go on to get divorced, though thankfully there are plenty of mortgage lenders who are willing to let sole name applicants take out a mortgage, so there could be options for you.
Our experienced team are well-versed in providing our customers with specialist mortgage advice in Essex. We are open 7-days a week, so book your free mortgage appointment in Essex today and we’ll get started on your mortgage process.
Last edited 21/11/2022