Joint mortgages can often be a better way of affording a home if your income alone isn’t sufficient to get the application approved.
However, later on, situations may arise where you’d want the joint mortgage transferred to a single person.
For instance, if a couple who had earlier taken a joint mortgage where to get divorced later, then the mortgage might need to be transferred to one person.
So, the question now is – can a joint mortgage be transferred to one person?
Yes, it is absolutely possible to transfer a joint mortgage to one person in the UK.
In this article, we’ll let you know how you can do that, the associated processes, and much more. So, let’s begin.
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How To Remove Someone From A Joint Mortgage
Essentially, there are two parts to getting this done: the Legal Process and the Mortgage Process.
Let’s take a look at each of these below.
The Legal Process
This is a simple process as long as all parties agree on what will happen. Like any other mortgage application, solicitors will also set up the legal charge with the lender and the named owners per the Land Registry.
As part of the process, you need to let the mortgage broker and solicitor know that it will happen through a transfer of equity. The solicitors will send you the required title transfer documents to complete. An extra charge for this is around £250-£300.
If all parties agree and all documents are in order, this can be done quite quickly. In case the person(s) you want to remove from the mortgage doesn’t agree to it, it might lead to a legal challenge and further more complex processes that are the remit of this article.
The Mortgage Process
Here, you must review your current mortgage and decide whether you want to stay with your current lender or change to a different one. This can be done with the help of a broker.
If you’re not tied to the current deal, you can consider switching lenders, which usually results in better rates.
The process is similar to remortgaging, and you’ll need to create a fresh mortgage application, even if you’re staying with the same lender.
This new application should be in the sole name of the person to whom the mortgage is being transferred.
Next, the lender will evaluate the individual application’s creditworthiness and either approve or deny it.
They might ask for the current income, credit history, and all associated details of the person to whom the mortgage is being transferred. The lender might even send a valuer to reassess the property.
If everything goes ok, the new mortgage might be approved and active within a month.
If you’re not approved due to a bad credit score or low income, then there’s no need to panic.
You can always look at other lenders who might be more than happy to grant you the mortgage.
In this case, we recommend taking the help of a mortgage broker who can assist you with the process.
You might need to transfer a joint mortgage to one person due to personal reasons, death, or divorce.
Whatever the cause, you’ll have to complete a transfer deed, and the same applies if a new person is being added to the mortgage.
Ultimately, it all depends on whether the sole applicant in which the mortgage is being transferred will meet the lenders criteria by themselves.
Can a Joint Mortgage Be Transferred to One Person Without Buying Out
The most important thing to remember is that you can remove someone from a joint mortgage without buying them out as long as the lender and the party being removed agree to it.
It all depends on the property’s ownership; most property is owned jointly (for a joint mortgage), so equity in the property is usually shared equally.
Sometimes the equity distribution can be unequal, depending on the joint parties’ agreement between them.
So, to remove a name or name from a joint mortgage and transfer it to a single person, you need to apply for an equity transfer and get the name(s) removed from the title deeds.
It essentially depends on the kind of agreement all the parties have agreed to.
There are several ways to remove someone from a joint mortgage, as explained below:
- Sell the property and split the proceeds
- Ask one of the involved parties to take over the mortgage on behalf of the others and complete this formally through the mortgage and legal process detailed above.
Long story short, it’s very much possible to transfer a joint mortgage to one person, provided the lender agrees that the sole person in question can make the repayments.
Frequently Asked Questions (FAQs)
1. Is it possible to add someone with bad credit to a mortgage?
Yes, it is, but you need to be careful that their credit rating impact isn’t so severe that it can result in your application being rejected. If you’re remortgaging with a person with bad credit, it might require a larger deposit and might even invite higher rates than usual.
It’s best to consult with a bad credit mortgage broker in these cases to understand the best course of action in such special cases.
2. Is it possible to transfer a joint mortgage to someone self-employed?
Yes, it is possible, as long as the person can prove to the lender that they have enough income to repay the mortgage and meet the required criteria. For self-employed persons, lenders might ask for more documents to assess their creditworthiness.
3. Is stamp duty applicable when transferring someone to or from a mortgage?
It might be. Stamp Duty is usually payable on the transfer of ownership of land and property so is more of a consideration when somebody is being added onto the mortgage.
In this case, it’s best to seek legal advice and inform the lender of the situation.
I am CeMAP & CERER qualified mortgage adviser and have helped a number of clients realise their dreams when they thought it would not be possible. I’m skilled at getting mortgages sorted for people with a history of missed payments, CCJs, defaults, debt management programmes, IVAs and bankruptcies.
