First Time Buyer Joint Mortgage
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First Time Buyer Joint Mortgage
Rita and Rohit Kohli explain how a joint mortgage works for First Time Buyers.
How do joint mortgages work for First Time Buyers?
It’s similar to buying on your own. Effectively, the lender will look at your combined income and your combined borrowings such as credit cards and loans, etc. They’ll assess you based on that.
They’ll treat it as if you were buying as a single unit, but you’ll still each need your own documents.
My partner is a First Time Buyer, but I’m not. What are my options?
There are the same options whether you’re a First Time Buyer or not. It should give you some reassurance – as long as we can look at your joint affordability and understand your circumstances, there’s a wider option there – there’s no limitations, really.
Also, some lenders class you as a First Time Buyer if you haven’t owned a property for some years. So even if you used to own a property, you may still be classed as First Time Buyers. In some cases that applies if you owned a home over three years ago.
Do both buyers have to be First Time Buyers? Do couples lose First Time Buyer status if one partner bought in the past?
Many lenders just need one person to be a First Time Buyer to qualify for First Time Buyer products. Some require you both to be first timers, but these tend to be very specialist products. The key consideration, though, is stamp duty – which leads us onto the next question.
Do I have to pay stamp duty if my partner is a First Time Buyer, but I’m not?
This is the main issue. While a lender can be subjective about what a First Time Buyer looks like, from a legal point of view you will have to pay stamp duty if either of you have ever owned a property, unfortunately.
Usually, you will lose your stamp duty allowance if you’re buying a property with someone who’s owned a property previously.
What does being joint tenants or tenants in common mean?
This is a technical legal thing. Joint tenants is where you legally own the property equally and both have equal shares to the house. Tenants in common could be where, for example, one person puts in a higher deposit than the other.
As tenants in common, one person can own a slightly greater share of the house than the other. It’s typical for friends who are buying together or people in a relationship who want to divide the financials they have put in.
So there are different ways you still own the house together. If you wanted to sell the property and it’s in tenants in common, the person who put in the higher amount gets the higher share. Joint tenants will always remain equal shares.
It also affects how inheritance works. For joint tenants, if you were to pass away, your share would pass to the other owner. But as tenants in common, you could allocate your share to whoever you wanted to in your Will.
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Can I get a mortgage with a guarantor?
Absolutely, yes. This is very often aimed at First Time Buyers trying to get on the property ladder. The guarantor is typically a parent, but can potentially be a friend or other relative. They would be named on the mortgage but not on the deeds to the property, to help boost affordability.
That helps make the mortgage payments affordable for the buyer and eventually the guarantor could come off the mortgage. The First Time Buyer then owns the property in their own right.
How much can you borrow as a First Time Buyer with a joint mortgage?
It will depend on your circumstances – your income, how much debt you have on credit cards and loans, including student loans, and also how much deposit you have.
Usually if you are purchasing jointly, you have effectively bigger borrowing power. You can borrow a higher amount than if you were buying a property on your own – because your combined incomes are higher.
How much deposit do I need?
In terms of deposit, there are some interesting schemes around at the moment targeted at First Time Buyers. If you qualify, you may only need a £5,000 deposit on a property up to £500,000.
If you have rented for a couple of years with a good track record of paying that rent, you may even be able to get a mortgage without a deposit. [Information correct at the time of recording in April 2025]
So you may not need a big deposit, but the more you can put down, the better the interest rate you’re likely to get from the lender. If you are able to put 5% or 10% down, you’ll get a slightly better interest rate than with a very low deposit.
What is a Joint Borrower Sole Proprietor mortgage?
It’s the long-winded, technical name to describe the guarantor mortgage we were just talking about. The joint borrower is the person going on to the mortgage and the sole proprietor is the person who legally owns the property.
The concept is the same – it’s to boost affordability. You can increase the size of the mortgage by having two incomes, or potentially even three if two more borrowers want to go on the mortgage. It reduces the risk level to the bank and encourages them to lend you the amount you need to buy a property.
Can you transfer a joint mortgage to one person?
Yes, in certain circumstances. It may be that one partner is moving out and the other is going to stay in the property. You would look to retain that mortgage and property purely for the person who’s staying.
The lender will want to assess your ability to pay that mortgage – that’s key. Although it may be possible to transfer that mortgage, the lender is not going to agree if you haven’t got an income coming in. They would want a different plan.
So it is possible, but the lender will do their own checks and balances to make sure that it is affordable.
How do you calculate a First Time Buyer joint mortgage?
The general rule of thumb is that you can borrow around four to 4.5 times your combined salaries. However, it still comes down to how many dependents you have and your liabilities – such as balances on loans and credit cards.
Lenders also look at your credit history and any extra income you might be getting, such as bonuses.
If your salary threshold is higher, and you’re lucky enough to be earning £100,000+ a year, sometimes lenders may boost borrowing up to five times your income. That will also depend on what’s going on in the background.
It also depends on the type of mortgage. If you wanted to fix your mortgage for 10, 15 or 20 years, to gain certainty over how much you’ll pay over the long term, lenders could potentially offer you six or even seven times your income.
Can I get a First Time Buyer joint mortgage if I have bad credit?
Yes, but you may have to work a bit harder to get it. For the low deposit schemes, you need to have good credit history and a strong record of keeping up your payments. With poor credit, you may not qualify for a low deposit mortgage.
We would suggest you would probably need a 15% deposit if you have had bad credit in the past. It could be more, or less, depending on the credit issue. But it’s absolutely possible to get a mortgage with bad credit if you’ve got the right deposit in place.
Because it’s a joint mortgage, there are two salaries and two incomes to consider. How long ago the credit blip happened would make a difference. The longer ago, the better. Plus, having two household incomes will help lower the risk levels from a bank’s point of view.
How can a mortgage broker help me get a joint mortgage as a First Time Buyer?
There’s reams of information at your fingertips, but it’s all about filtering through all that and making it individual to you. That’s where a mortgage broker can help – we understand that information and criteria, and the products are continuously changing.
What you might have read a week ago may already be out of date. But because we’re dealing with banks and lenders and we know the areas you’re potentially buying in, it really helps to have us hold your hand and guide you through it.
We take you through the complexities of understanding what mortgage is right for you and which lender to choose.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP WITH YOUR MORTGAGE REPAYMENTS.
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