Joint Borrower Sole Proprietor Case Study

by | Tuesday 10th Nov 2020 | Mortgage Case Studies

joint borrower mortgage application

A bit of background:

In 2019, Our client first came to us at Oportfolio to see how we could help him purchase his dream first home. Like many first-time buyers, our client did not know where to start and did not know what he could afford. After speaking to one of our advisers and running through his finances, we learned that he would struggle to reach the lending amount that he needed to purchase the property if he were to get a mortgage on his own. Our client’s father offered to help his son in any way he could, as most parents would, and suggested that he could go on the mortgage with his son. The dilemma was, however, our client’s father already owned his own property which would mean that he would be liable to a hefty stamp duty fee which nobody wants! That’s where a joint borrower mortgage came in to play.

What did we do to help?

Jade Pinkerton, one of Oportfolio’s senior mortgage advisers identified our client’s predicament immediately and started working on a solution that both father and son would be very happy with. After getting to know the clients and doing some research, Jade advised that the best route forward for the purchase would be a joint borrower sole proprietor mortgage.

Unlike a regular mortgage, this type of mortgage would allow both father and son to go on the mortgage with both incomes considered for affordability purposes but, only the son would be on the deeds of the property. As the son would be the only person on the deeds of ownership, he would benefit from first time buyer stamp duty rules. We also made sure that they were both insured and protected against the debt should anything happen to the other.

Happy Clients:

Fast forward to 2021, Our client moved in and absolutely loves his very first home. He has been making the most of being able to decorate and really make it his own with his unique design and stylings during lockdown.

He has now paid off some of the mortgage we secured for him in 2019 and the value of his property has increased meaning that the equity he has in his property has also grown.

What’s next?

Since initially speaking to Jade in 2019, Our client has had a pay rise, so we are now re-mortgaging him onto a more competitive interest rate than he is currently on and MORE IMPORTANTLY we are now able to take his father off the current mortgage, removing the joint borrower element and transfering the whole mortgage and deeds just in the son’s name which was always the end goal. We have also extended the term of the mortgage and made the monthly payments more comfortable for him.

Oportfolio’s wealth of mortgage knowledge really helped our client’s dreams come true. If you or someone you know is in a similar predicament to our clients, please give our friendly team a call on 02073715063 to see how we can help you too!

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