Step-by-Step Guide: How to Get a Mortgage With 3 Applicants

As a team of expert mortgage brokers, we understand that navigating the mortgage market can be complex, especially when multiple applicants are involved. So, let’s simplify it.

Many people have asked us a common question: “Can I get a mortgage with three applicants?” The answer is yes; you can get a mortgage with three applicants. In fact, most lenders will permit between one and four people on a mortgage.

However, it’s important to note that some lenders may only accept applications from family members or couples, and not all lenders will consider the income of all applicants.

Now, let’s dive into some key statistics about the UK mortgage market. As of 2023, the total value of mortgage lending in the UK reached its highest point since 2007, with a total gross mortgage lending of £315.95 billion. The outstanding value of all residential mortgage loans was £1,654.3 billion, with gross mortgage advances increasing by 18.6% from the previous quarter to £62.2 billion.

These figures highlight the dynamic nature of the UK mortgage market and the potential opportunities for prospective homeowners, including those considering a mortgage with multiple applicants. As we move forward, it’s essential to understand these trends and how they might impact your mortgage application process.

This article will discuss how to get a mortgage with three applicants, the ins and outs of what to expect from discussing this option with lenders, and some of the benefits of getting a multi-person mortgage.

Post Topics

What is a multiple-person mortgage?

How many people can be named on a mortgage?

Can I get a mortgage with 3 applicants?

Calculating the Maximum Mortgage Amount

Next Steps

Frequently Asked Questions

What is a multiple-person mortgage?

A multiple-person mortgage is a mortgage that has more than one or two people named on the mortgage agreement. However, not every mortgage lender offers this option. Some are concerned it will impact monthly mortgage payments, whereas others do not have the specialist expertise to offer this mortgage to customers.

If you are interested in learning more about a multiple-person mortgage, the good news is that you have come to the right place! This article will teach you everything you need to know about three-person mortgages and how to find one.

Fortunately, some brokers welcome mortgage customers with more than two applicants, either for friends or family members. However, it is worth being aware of some of the restrictions that may be put in place as a result of your desired request. We will cover these restrictions in much greater detail later in this article.

How many people can be named on a mortgage?

In short, the number of people named on a mortgage depends entirely on which mortgage deal you take and what a mortgage broker is willing to offer you. Some lenders only offer a mortgage product for one or two applicants, whereas others offer you the chance to add more applicants.

Some lenders prefer to ensure all applicants live in the property, as it gives them more assurances that mortgage payments will be met, whereas other lenders do not mind if only one of the applicants lives in the property.

Can I get a mortgage with 3 applicants?

You can get a three-person mortgage, but a few lenders only consider a joint mortgage of more than two people if the applicants are all related.

Other lenders will allow a multiple-applicant mortgage to be given to friends and family, but they might not allow all three applicants’ actual income to be included in the mortgage calculator.

To have your mortgage details approved for a three-way mortgage where each applicant’s income is factored in, speak to a specialist broker. While many mortgage brokers offer a strong normal mortgage offering, some brokers are specialists and work with lenders who are used to these sorts of arrangements.

The Benefits of a Multiple-Person Mortgage

There are several reasons why getting a multiple-person mortgage can be extremely beneficial.

• More funds to put down as the deposit

As you would expect, if you are placing a deposit across three people rather than two, then the deposit will be larger. There are so many benefits to putting down a larger deposit, such as getting offered more favourable deals and rates, not to mention not needing to borrow as much because you have paid more upfront.

• More affordable payments

Payments become much more affordable when there are three of you combining to pay them. Monthly repayments that perhaps would have seemed steep for you on your own suddenly become much easier when you split it across three people.

Not to mention the fact that if one of you is short on money for one month, you can still make the payment and not suffer any late fees.

• Could borrow more

Finally, one major benefit of getting a multiple-person mortgage is that you might be able to borrow more. If you pick the right lender, they will provide the same income calculations as if you were on your own. So, if they offered you 5x your income of 40k (200k total), and you chose to apply for a mortgage with two other friends who earn 40k, you could get a mortgage offer as high as 600k.

Calculating the Maximum Mortgage Amount

When you are trying to estimate the maximum amount you will be able to borrow as part of a multiple-person mortgage, you need to bear in mind that some lenders only consider the two highest-income earners in their affordability assessment.

Therefore, the cap on the maximum loan amount will be based on a multiple of the two salaries combined, not all three. However, they will still check the credit scores of all three applicants.

On the other hand, other lenders may opt to change the income multipleA calculation used by mortgage lenders to assess how much a ... to three to cover all of the applicants. There are even some specialist lenders that will consider the income of more than three applicants, although it is rare, and nearly all lenders cap it at four applicants for the maximum loan as part of a mortgage application.

For a joint mortgage, most mortgage brokers will cap the lending at 4.5 times the joint income of the number of applicants they are factoring in. However, they may sometimes stretch even as far as six times the annual income of each applicant. Factors that impact this will include employment status, deposit size, income evidence, income type, and current income.

However, don’t expect many lenders to consider all applicants’ income if you go past 4.5 times the application income.

Next Steps

Getting a mortgage with three applicants is complicated, but with the right advice, it’s easy. If you are interested in mortgages with multiple applicants, there are several key factors to consider. By understanding the process and taking the necessary steps, you can increase your chances of securing a mortgage that suits all parties involved. We would suggest you to contact our team of expert mortgage advisers to help you with your application.

Frequently Asked Questions

Can a joint mortgage be converted to a sole proprietor mortgage?

Yes, a joint mortgage can be converted to a sole proprietor mortgage. This typically involves one borrower buying out the other and refinancing the mortgage solely in their name. However, the borrower must meet the mortgage provider’s lending criteria to qualify for this change.

What is the difference between a multi-person mortgage and a multiple-applicant mortgage?

A multi-person mortgage and a multiple-applicant mortgage are essentially the same, referring to a mortgage where more than one person applies and is responsible for the loan payment. This can include joint borrower scenarios, such as friends, blood relatives, or business partners.

How does a guarantorA person who guarantees to repay a mortgage if the borrower ... mortgage differ from a joint mortgage?

In a guarantor mortgage, a third party, usually a family member, agrees to cover the mortgage payment if the borrower defaultsMissed payments on credit accounts, which can affect a borro.... This is different from a joint mortgage, where all parties are joint borrowers and equally responsible for the mortgage repayments.

Can a mortgage adviser help with a joint mortgage application for a larger mortgage?

Yes, a mortgage adviser can provide expert advice and help navigate the process of a joint mortgage application, especially when applying for a larger mortgage. They can assess your combined income, credit score, and other factors to find a suitable mortgage deal.

How does bad credit affect a joint mortgage application?

Bad credit can impact a joint mortgage application. Lenders will look at the credit file and credit report of all applicants. If one applicant has a poor credit score, it might reduce the chance of approval or result in less favourable terms.

What are the implications of a joint mortgage when one borrower has a poor credit score?

If one joint mortgage holder has a poor credit score, it can affect the entire mortgage application. Lenders consider the combined credit history of all applicants, so a poor credit score can lead to higher interest rates or a lower maximum loan amount.

How do mortgage providers assess affordability in a joint mortgage?

Mortgage providers conduct an affordability assessment, considering factors like annual income, income ratio, and proof of income of all applicants. This helps determine the monthly repayment amount and the mortgage term that can be offered.

What should be considered in a joint agreement for a mortgage with friends?

In a joint agreement for a mortgage with friends, it’s crucial to outline the terms of ownership, responsibilities for mortgage repayment, and plans for scenarios like selling the property or changes in personal circumstances. This should be a legal document to ensure complete confidence and clarity for all parties.

Can first-time buyers apply for a joint mortgage?

Yes, first-time buyers can apply for a joint mortgage. This can often increase the chance of approval and potentially allow for a larger mortgage, as lenders will consider the combined income and credit records of all applicants.

What types of mortgages are available for joint applicants?

There are various types of mortgages available for joint applicants, including residential mortgages, buy-to-let mortgages, and exclusive mortgage deals offered by specialist lenders. The type of mortgage allowed will depend on the applicant’s circumstances and the lender’s criteria.

These FAQs incorporate the provided terms and offer a comprehensive overview of considerations and scenarios related to joint mortgages.