Joint Borrower Sole Proprietor Mortgages


Joint Borrower Sole Proprietor Mortgages

28 May 2019

It’s no secret that getting a deposit together can be tough. Fortunately, there’s a ray of hope for first-time buyers desperate to get on the property ladder, thanks to Joint Borrower Sole Proprietor mortgages.


What is a Joint Borrower Sole Proprietor mortgage?


Joint Borrower Sole Proprietor mortgages allow you – the parent or guardian – to apply for a mortgage with your children in order to assist them in borrowing the required amount and increase their chances of being accepted. 


What are the benefits of Joint Borrower Sole Proprietor mortgages?


The key benefit of a Joint Borrower Sole Proprietor mortgage is that parents can assist their child in buying a home of their own while avoiding the 3% second property Stamp Duty surcharge.

JBSP mortgages take into consideration your (often higher) salary alongside your child’s to increase both their borrowing power and their chance of approval. Another benefit of this scheme is that the deeds of the property belong solely to your child.


When can I use a Joint Borrower Sole Proprietor mortgage?


JBSPs can open up a number of different products that may not have otherwise been available to you. It’s a particularly good step on the ladder for:


  • Residential mortgages
  • Buy-to-Let loans
  • First-time buyer investment


What happens later?


Fundamentally, your support should be both minimal and short-lived, so it’s important for your child to show that they can eventually afford the repayments on their own.


The good thing about JBSPs is that when circumstances change, like you child starts earning more money, they’ll be in a position to remortgage and release you from the joint mortgage.


Things to remember about JBSP mortgages


Joint Borrower Sole Proprietor mortgages enable applicants to afford a larger mortgage, often with access to a wider range of deals. The primary applicant – your child – will have full ownership and your co-applicants won’t have the additional second property surcharge Stamp Duty to pay.


Since you and your child are both applying for the mortgage you’ll both be responsible for the mortgage repayments and any associated charges. Both parties are advised to seek separate legal advice and independent tax advice and show that you understand the risks involved.


For more information about Joint Borrower Sole Proprietor mortgages – or anything else that’s moving home-related – get in touch with one of our experts today. Otherwise, give us a call on 0800 854 499 and see how we can help you and your family move forward on your life’s journey.