Buying with family member

P

PAR

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If a family member is unlikely to receive mortgage approval but in practice could cover mortgage payments is it possible to go for a joint mortgage with them and once the property is purchased to remove yourself from the deeds of the property? Could you then switch the mortgage to another bank and remove yourself from the mortgage?
 
If the family member (applicant 1) is unlikely to receive mortgage approval with one lender, they will be assessed on the same criteria with another lender.

If a joint borrower (applicant 2) is needed for approval, regardless of whether applicant 1 is in practice able to meet repayments on their own, the lender will not let the applicant 2 just remove themselves from the mortgage. It isn't a case of just getting initial approval and then being able to adjust the terms. The mortgage is on the lenders terms and conditions and unless applicant 1's financial status improves sufficiently to be assessed as a sole applicant they won't allow the terms of the mortgage be adjusted.

Regarding the title deeds, on the initial application the lender may allow for joint borrowers sole title.
 
Many thanks for your reply, would the new bank demand that the criteria for a new buyer be met by a home owner who could demonstrate that they are already making the mortgage payments and is switching banks - albeit without the other owner?

I'm not sure I understand the "joint borrowers sole title", the bank would hold the deeds but would you have to organise the new mortgage (if possible) before you have the deeds changed or are the deeds tied into the mortgage?
 
Many thanks for your reply, would the new bank demand that the criteria for a new buyer be met by a home owner who could demonstrate that they are already making the mortgage payments and is switching banks - albeit without the other owner?
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If the borrower is demonstrating the capacity to cover repayments this will be taken into account. However, the lender calculates mortgage approval mainly on income multiples. Switching lenders will effectively mean that a new mortgage is being sought and similar criteria will apply as to the original mortgage.

I'm not sure I understand the "joint borrowers sole title", the bank would hold the deeds but would you have to organise the new mortgage (if possible) before you have the deeds changed or are the deeds tied into the mortgage?
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Joint borrowers means that there are two applicants. In this case two applicants are required as one applicant is having difficulty getting the mortgage amount wanted on his/her own. Two people on the mortgage application so two borrowers. If there are two borrowers on the mortgage the title deeds are usually registered in two names also. So there are two owners of the property.

Some lenders may agree to have two people on the mortgage ie two borrowers but only one on title (one owner). This depends on the lender. The title deeds 'belong' to the original lender as this is their security for the loan so when they are giving you the original loan it is their terms and conditions that you abide by.

There is nothing to stop you switching to anther lender at any time (once the new lender has approved you). The new lender will however also assess the application and if you do not qualify on income multiples, may offer a lesser amount or a joint borrower may have to go on the new mortgage application again which leaves you in the same situation.

I'd suggest talking to a broker. S/he should be able to tell you if the lenders will require a second borrower on the application once they have calculated the max. amount you are eligible for, and could look into the possibility of a family member going guarantor on the mortgage etc
 
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