What to consider if you’re buying a home with a friend
What to consider if you’re buying a home with a friend
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Buying a home can be a struggle with mortgage rates and house prices remaining high, and so for some house hunters it could make sense to club together with a friend or a co-habiting partner. But while this may solve some cost issues, there are also some vital considerations when buying a home with someone else.
Ben Thompson, deputy CEO, Mortgage Advice Bureau, explains that, when it comes to mortgages, there may be some downsides as well as positives to think about. On the upside, he says: “The benefits of having a buying partner doesn’t just come from having deeper pockets for your deposit. It also gives you the chance of securing a joint mortgage, allowing you to borrow more together, so you can secure a larger and perhaps more suitable place to live.”.
But he cautions: “There are potential downsides to a joint mortgage. For instance, a friend’s poor credit could impact your ability to borrow. “It’s also important to remember if their financial situation worsens after moving in, you’ll both be equally responsible for payments. This could be challenging if they struggle to pay their share.
“It’s crucial to trust your partner and feel confident in their reliability.”. He suggests consulting with a mortgage expert to fully understand the implications and risks. Thompson also highlights the different types of property ownership that people may consider when buying a home together, adding: “Joint mortgages and joint ownership aren’t always the same.”.
