Joint Shared Ownership
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Joint Shared Ownership (Part 1)
Lilly Harrocks explains how a joint shared ownership mortgage works.
Can two or more people apply for a shared ownership mortgage jointly? How does it work?
Up to four people can apply for a shared ownership mortgage together. Applying jointly means that up to four incomes can be taken into account, which can increase the amount you can borrow and improve affordability.
Do all applicants need to meet the eligibility criteria individually?
All applicants buying the shared ownership property would need to meet the eligibility criteria. That means your household would need to earn less than £80,000 per year in total, or £90,000 if you’re in London.
You must not own any other property at the time of the shared ownership purchase, and you must not be able to find a suitable home on the open market. Those are the criteria that you’ll need to meet. Each person on the application will need to meet that individually.
How is ownership divided between joint applicants? Do we split rent and mortgage payments 50-50 or can it be tailored?
You jointly own the share you purchase together, and the housing association and mortgage provider will always hold you jointly and wholly accountable. However, the way you split the cost between yourselves is entirely up to you.
It doesn’t have to be 50-50. Some buyers contribute different amounts to the deposit or different amounts to the monthly mortgage payment. If contributions are uneven, you should consider recording the details in a legal agreement such as a Deed of Trust, which basically allows you to stipulate the ownership shares.
Can we change the ownership percentages later on?
Yes, you can make amendments to that Deed of Trust at a later date with your solicitor, if any personal agreements change.
If one party no longer wants any ownership of the property, you’d need to carry out a Transfer of Equity to remove them from the deeds and update the mortgage. That would also need legal advice and lender approval.
What happens if one party wants to sell or exit the agreement?
This is where it can get a bit political, if you’ve got multiple people in the mortgage. We’d encourage anyone to chat through an exit agreement with the other parties so you’re all on the same page.
At such time, you can either sell the shared ownership property and both parties move on, or one partner buys out the other’s share through a Transfer of Equity.
How is affordability assessed on joint shared ownership applications?
Lenders will assess the combined income of all the applicants. Some lenders only use a maximum of two applicants’ income, even if there are more than two applying for the mortgage. Other lenders will look to use up to four incomes on the mortgage application.
They’ll look at any existing debts and financial commitments, credit histories, mortgage payments on the share you are buying, the rent on the remaining share, and any service charges and ground rents.
The housing association will also run their own affordability checks to make sure the property is sustainable for you long-term.
Do both applicants need to be employed or have an income?
You could be employed, self-employed, have an income from pensions or income from benefits. A wide range of different income streams can be considered. It’s worth talking to an advisor to explore your income and find a suitable lender.
You can also be on the mortgage even if you don’t have an income. Affordability checks require at least one applicant on the mortgage to have an income, so if that’s the case you can certainly be a part of that mortgage.
You might be a couple with one breadwinner, for example – it’s absolutely fine for the non-earning partner to still be on the mortgage.
What is the minimum deposit required for a joint shared ownership mortgage?
You should aim for 5% of the share you’re buying. However, some schemes could allow you to put down a deposit of less than 5%, subject to eligibility criteria and affordability. We’re seeing more of these schemes come to the market to help first-time buyers.
Some lenders require more than 5%, so it’s worth speaking with an expert mortgage advisor to understand what’s possible for you. Then you can have a realistic goal to aim for.
Can we use a joint Help to Buy ISA or Lifetime ISA towards the deposit?
You can’t open a new Help to Buy ISA account, but if you have an existing account you can still use that and get your 25% bonus from the government.
You can use either a Help to Buy ISA or a Lifetime ISA towards the deposit of a shared ownership property, as long as your purchase price is within the scheme limit. For a Help to Buy ISA that’s about £250,000, and on a Lifetime ISA it’s £450,000. If you buy below those limits you will still be eligible for your 25% bonus [information is correct at the time of recording in March 2026].
Which lenders offer joint shared ownership mortgages? Are there many?
Yes, plenty of lenders support the shared ownership scheme. A few household names include Barclays, Nationwide, Halifax, NatWest, Santander and TSB. Each lender has different eligibility criteria and affordability calculations.
A mortgage advisor will find the right lender for you. Just because a lender offers shared ownership mortgages, it doesn’t necessarily mean they’ve got the most comprehensive criteria or they’re right for you. But you’re not short of options for a shared ownership mortgage.
Should we buy as joint tenants or tenants in common?
This is a choice regarding legal ownership of a property, so it’s something to talk through with a solicitor.
Joint tenants is where both parties own the property equally. If one person were to die, ownership automatically passes to the other. With tenants in common, each person owns a defined share, for example, 60-40, and those shares can be passed on through a Will, so they don’t necessarily get passed across to the joint party.
This is usually good when co-owners have contributed different amounts towards the purchase. Maybe they’ve put more deposit in or they’re paying more each month on the mortgage payments. To understand what’s right for you, seek legal advice before making a decision.
What legal agreements should we have in place?
A Deed of Trust or Declaration of Trust are the same thing and are useful to have in place where contributions aren’t equal. It records how much each person contributed to the deposit, how monthly payments are split and what happens if the property is sold or if one person wants to leave.
That helps with any disputes later on. Essentially, if I put in £5,000 and you put in £10,000, we can record that. When we do sell the property, we both get our money back.
Can we ‘staircase’ to buy more of the property together at different times?
Yes. Staircasing is a way of purchasing more of a share of the property. You might start out by purchasing 25% and then later you can afford to buy a bit more. You buy an extra 25%, for example, and then you’ll own 50% of your home.
The increments are usually set by the housing association and can vary, but ultimately the end goal is to staircase to 100% and own the property fully.
If you buy jointly, you’d need to staircase together. The additional share is still owned jointly. As you typically require additional finance to fund the extra share, it’s good to do this when you’re coming to the end of your rate and are reviewing your mortgage options.
That way, you can make sure your mortgage is kept up to date and is suitable for the increased amount that you then own.
What else do we need to know about joint shared ownership mortgages?
We would just encourage you to have a conversation with a mortgage advisor. Many lenders do offer shared ownership mortgages and there are a wide range of properties available in the shared ownership scheme.
We’re here to help you understand the next steps and what you can realistically do. We give you that confidence to move forward and buy a property.
Key Takeaways:
- Up to four people can apply for a joint shared ownership mortgage, and all applicants must individually meet the eligibility criteria, such as having a household income below £80,000 (or £90,000 in London) and not owning any other property.
- While the mortgage provider holds all joint applicants wholly accountable, the way the buyers split the rent and mortgage payments is up to them and does not have to be 50-50.
- If contributions to the deposit or monthly payments are uneven, a legal agreement such as a Deed of Trust is recommended to record ownership shares and help prevent future disputes.
- Affordability is assessed on the combined income of all applicants, and a wide range of income streams are considered, including being employed, self-employed, having pensions, or receiving benefits; at least one applicant must have an income.
- You can buy more of the property over time through a process called ‘staircasing,’ but joint applicants must do this together, and it is recommended to review mortgage options when nearing the end of your current rate to ensure the financing is suitable for the increased share.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP WITH YOUR MORTGAGE REPAYMENTS.
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Joint Shared Ownership (Part 2)
What happens to the mortgage and property share if we separate? Can one person take over the mortgage if the other leaves?
Potentially, yes. If you’re tied into a mortgage product, you would need to contact the lender and they would run affordability checks to see if one person can take it on in their own right.
If not, and you’re tied into a product, you might want to look at other lenders. Switching providers could potentially involve a penalty to come out of the current product early.
We spend a lot of time talking about the positives of buying a home jointly, but it’s important to consider this – it does happen more than you might expect.
What documentation is required from the applicants? Do we both need to attend meetings and sign all the paperwork?
It depends upon the circumstances – that will determine what documents are required. If you’re employed, we would typically request your latest three months’ payslips. If you also receive overtime or bonuses etc. we may need more.
If you’re a sole trader or in a partnership, we need the latest two years’ tax calculations and overviews. Typically the most recent documents can’t be more than 18 months old.
We’ll always require three months’ bank statements, and we may request copies of credit reports and P60s. For limited companies we could need three years’ full company accounts.
Both people don’t necessarily need to attend all the meetings, but both will need to sign the paperwork.
Are there specific solicitors who specialise in joint shared ownership?
Not usually, although some solicitors may have more experience than others. Some lenders do work with a specific panel of solicitors, so it’s important to find out which solicitors are on that panel.
How long does the process typically take for joint buyers?
The process is no different from someone buying on their own. It might take longer if one party takes time to provide their documents.
Typically, it takes about a week between someone booking an initial appointment to us coming back after our research. It could be quicker or slower. The time it might take to find a property can vary a lot, but once you do find one it takes three to four weeks to get a mortgage offer.
It then comes down to the solicitors in how quickly things move. If you’re buying a new build property, the building process will determine how quickly you can actually move in.
Can we apply with different credit histories or income levels?
Sometimes one person has bad credit, with some missed payments or worse, and the other has a clean credit profile. It’s just subject to the lender’s credit scoring approach.
The same is true for income. If one person has a lower income than the other, it just comes down to the overall affordability and what is possible for them.
Neither will stop you from getting a mortgage. We will just go through all those details and guide you through the process.
Are both parties equally liable for the mortgage and rent?
Yes. If both parties are named on the mortgage and the deeds, they’re both liable for the mortgage and the rent. It doesn’t matter whether they agree to a typical 50-50 ownership or whether one person owns 99% and the other owns 1%. It’s important to make sure both are paid on time.
What other costs do we need to budget for?
There are the costs of buying the property, and then the costs on a monthly basis once you own your home.
When looking to buy the property, you would typically budget for broker fees, valuation fees, solicitor fees and potentially stamp duty. Stamp duty can vary depending on whether you’re first-time buyers, and also whether you pay duty on the percentage you’re buying or it’s based on the full market value.
After you’ve bought the property, there will be monthly mortgage payments, rent on the other share, plus ground rent and service charges.
Other things to budget for include life assurance, critical illness cover and income protection. One of our specialist protection advisors will chat you through that.
Can joint applicants get financial help or benefits?
We wouldn’t be able to advise on any benefits they may be entitled to – they would need to find that out themselves. But where people already receive child benefit, universal credit or PIP payments, those can be used towards the affordability of the mortgage.
People might also be getting housing benefit, but that can’t be used towards the mortgage.
How is the sale of a shared ownership property handled with joint owners? Can we sell our shares independently?
You could potentially sell your shares independently, but the other person would need to agree. You could sell your share to the other person, or to someone else – perhaps a family member.
You can’t just market your 50% share of that property and sell it to a random person. There would need to be an agreement in place with the other party on the mortgage.
There may also be additional costs such as stamp duty or transfer of equity fees. It’s potentially possible, but there will be a lot of factors to consider.
What legal protections exist if one person stops paying?
There isn’t any legal protection if one person stops paying. You’re both liable to pay the mortgage and rent.
It’s very important when buying a property to make sure you’re on top of your direct debits and your credit profile. Those payments need to go out on a monthly basis.
What happens if one person passes away?
It’s never nice to think about, but it could happen. It definitely needs to be taken into consideration, with life insurance and other protection included when budgeting.
It’s part of our process to make sure that clients are protected, and one of our protection specialists will have a conversation with you about life assurance, critical illness cover or income protection.
If someone passed away, suffered a critical illness, or was unable to work due to ill health, protection will make sure mortgage payments and other costs are covered.
The last thing you want to do is leave someone with a large debt, or be in a position where you have to sell that property. You spent a long time saving the deposit to buy it, so make sure you’re protected.
Can we transfer ownership between us or to a third party?
Yes, it is possible to transfer the ownership between you and a third party. Again, it’s subject to the agreement of those involved in the mortgage and on the deeds – and potentially the lender. There may be costs involved with making those changes.
How can a mortgage broker help with a joint shared ownership mortgage?
With shared ownership, either jointly or sole, the most difficult part is affordability. It will be based upon the percentage share you’re looking to buy.
The more you buy, the less rent you’ll pay, but you’ll need a bigger mortgage. You’ve also got to account for service charges. There are lots of variables to consider around affordability, so it’s really important to speak to a mortgage broker early.
We’ll give you a really good idea of what those costs will look like, whether you’re buying a 30% share, a 50% share or more. Having that information upfront is always helpful.
Key Takeaways:
- Both parties named on the mortgage and deeds are equally responsible and liable for the mortgage and rent payments, regardless of the percentage of the property they own.
- In the event of separation, one person can potentially take over the mortgage, but this requires the existing lender to perform affordability checks or may necessitate switching to a new lender, which could incur an early exit penalty.
- Joint applications can move forward even if one person has a lower income or a less favourable credit history, as the outcome is based on the overall affordability assessment and the lender’s specific credit scoring approach.
- Applicants must budget for initial costs like broker, valuation, and solicitor fees, and ongoing monthly expenses including mortgage payments, rent on the unowned share, ground rent, and service charges.
- It is crucial to consider protection, such as life assurance and critical illness cover, to ensure that mortgage payments and other associated costs would be covered if one party passes away or is unable to work due to ill health.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP WITH YOUR MORTGAGE REPAYMENTS.
For specialist tax advice, please refer to an accountant or tax specialist.
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What you need to know…
The actual amount you can borrow will depend on your credit commitments, your regular monthly outgoings and how each lender assesses your income.
Lender’s affordability checks can differ meaning that the amount you can borrow may change from lender to lender. That’s where the expertise of our personal advisers comes in and where our independent status benefits you.
The minimum deposit required is 5% of the property purchase price. Most lenders will allow the deposit to come from a gift and some lenders will even consider this being raised via a personal loan. There are government incentives to help boost your savings if you are a first time buyer. Depending on your circumstance you may either need to have a larger deposit or will perhaps want to put a larger deposit down, due to preferable interest rates.
Because we are independent mortgage brokers we will be able to secure you the best deal for your circumstance.
An Agreement in Principle, also known as a ‘Decision in Principle’ will be provided after affordability and credit checks have been approved. An Agreement in Principle is extremely useful to increase your confidence when viewing and offering on properties. Estate Agents will typically want to see an Agreement in Principle before presenting your offer to the seller. Our personal advisers can help you with this.
It’s a requirement of your mortgage to have buildings insurance. This covers the bricks and mortar of the property.
It’s also a good idea to take advice from your personal adviser on protecting you and your loved ones if something bad happens. For example: Life Cover, Critical Illness Cover and Income Protection.
Being accepted for a mortgage does depend on your circumstances. We are experts with all types of mortgages…. We specialise in obtaining mortgages for the self-employed, contractors, construction industry scheme (CIS) workers and those with historic adverse credit (as well as employed people of course). In all these situations we can frequently secure high street deals. Being independent and experts is a real benefit in these circumstances.
Your monthly payments will vary depending to your chosen mortgage term, choice of mortgage product, how much deposit you have and repayment type. It is best to chat with a personal independent adviser to find out exactly what interest rate and term you can secure to give an accurate monthly payment.
Most of the first time buyers we have helped secure a mortgage are paying less on their mortgage than they used to pay on rent. This does, however, depend on circumstances. The mortgage term chosen is a major factor which can be dictated by your age and intended retirement age. Of course, it is also worth noting you are paying back the mortgage and once it is repaid you won’t have any rent to pay.
There are costs associated with purchasing your first home. You will need to pay legal fees and other potential costs include a survey fee, stamp duty (which is a property land tax) and administration fees. There are First Time Buyer government incentives on savings and stamp duty that can help you with raising the monies for a deposit, costs and reducing stamp duty. Our personal advisers can give guidance within a free consultation.