If your partner is living with you in a property you own, what are the pros and cons of getting their name added to the mortgage?
Moving in with a partner can be a big step for your relationship. If you own a property, you might decide the best solution is for your partner to move in with you. But once you’re settled in together and decide it’s for the long-term, is it a good idea to have their name added to the mortgage? And, if you decide to go ahead, how exactly do you go about it?
Here, we look at the process of adding a partner’s name to your mortgage, as well as the advantages and disadvantages of doing so.
What the process entails
Unfortunately, it’s not as straightforward as simply making a call to your current lender and asking them to add your partner’s name to the deed.
Your partner will need to go through the same credit and affordability checks as you did when you first got the mortgage, to ensure they will be able to keep up with repayments. However, you might be charged a fee for this and, if your partner doesn’t meet your lender’s criteria, your lender is not obliged to add them.
If your current lender won’t add your partner, or if you’d like to shop around for a new deal together, you have the option to remortgage. This will be treated as a new joint mortgage application, meaning you’ll both have to provide proof of income, alongside passing credit and affordability checks, and getting the property valued.
Seek advice from a mortgage broker
Whether your current lender adds your partner’s name to your existing mortgage, or you end up remortgaging, it’s a sensible idea to make an appointment with a mortgage broker. They will be familiar with the process and can guide you through the steps you’ll need to take.
It’s also important to seek the legal advice of a solicitor, who will be able to help you decide whether it’s best for you and your partner to become either tenants in common or joint tenants. Tenants in common means that you own different shares of the property. You may have a 50/50 split, or one party may own more than the other. Joint tenants means that you both own the property equally.
It’s recommended that you also discuss any potential tax or inheritance implications of you owning a property together with your accountant or tax expert.
If you choose the tenants-in-common option, a solicitor must advise your partner so that they fully understand what they are committing to.
Again if you choose tenants in common, it’s also essential to make a will. If one of you dies without a will, the property will pass to their heirs or closest family members.
Pros and cons of adding your partner
Adding your partner to your mortgage is a big decision and one you should consider carefully. Every couple’s situation is unique, so there is no simple ‘yes’ or ‘no’ answer when it comes to whether you should go for it; only what’s right for you and your situation.
If your partner is already contributing to paying off the mortgage and/or household bills, adding them to the mortgage is a sensible choice. It can also be a good idea if you have children together. Having your partner on the mortgage can increase your borrowing capacity, making it easier to qualify for a larger loan amount and helping when you remortgage in the future. It can also provide you with greater financial support and stability.
However, if you become a joint homeowner, bear in mind that your partner’s credit history becomes associated with your own. This might not be a problem, but if you currently have a good credit rating and your partner doesn’t, this could negatively impact you.
Ultimately, the decision to add your partner to your mortgage is a personal one. If you’re struggling to decide or want to find out more about how to get started, we’re here to help with advice.