What is a Joint Borrower Sole Proprietor Mortgage?

A Joint Borrower Sole Proprietor sometimes known as a Mortgage Boost or Family Assisted mortgage is a type of Mortgage where multiple people accept full financial responsibility for the mortgage, but only one person is legally named on the property deeds as the owner.

It is primarily used as an "income boost" to help first-time buyers who cannot afford a property on their own salary. However, it can also be used in other circumstances

How Does a Joint Borrower Sole Proprietor Mortgage Work?

The most common scenario is where a child buys a property but their income doesn’t quite meet the affordability of the lender so they add their parent onto the mortgage and the lender takes the income of the parent into account. The combined income can increase the amount of borrowing. We have seen these types of mortgages also used for parents who may have separated and their child be added to the mortgage also.

What Are the Stamp Duty and Tax Advantages of a JBSP Mortgage?

Only the main occupant is named on the deeds. This can enable a buyer to utilise their “first time buyer relief” for SDLT and prevent a “higher rate” sdlt being applied where the parent owns another property. This can also prevent issues with any Capital Gains Tax if the property was purchased in joint names.

Which Lenders Offer Joint Borrower Sole Proprietor Mortgages

Many lenders offer these type of mortgages and including at the date of writing this article Barclays, Halifax, Natwest, Metro Bank, Halifax and Santander, Clydsdale Bank, Skipton Building Society, Principality building Society.

Do I Need Independent Legal Advice for a JBSP Mortgage?

Its important to seek advice from an Independent Financial Advisor to check whether this type of mortgage is suitable and available for you.

Do I Need Independent Legal Advice for a JBSP Mortgage?

With these types of mortgage the lender usually insists that the none owning borrower seeks advice from an independent solicitor who doesn’t act for the buyer or lender.

Elliot Mather LLP can assist in providing this advice at a competitive price and usually can arrange an appointment and complete and return the necessary documents quickly preventing any delay.

Whilst there are many advantages to the owning borrower there are associated risks to the none owning borrower and this is why the lenders require the advice to be sought.

Speak to Elliot Mather LLP About Independent Legal Advice

We will provide clear jargon free and practical advice to ensure the none owning borrower is aware and happy to proceed with these risks and also offer suggestions how this risk can be mitigated. We will also highlight issues which may arise but may not have been considered at the application stage.

If you are entering into one of these mortgages and require Independent Legal Advice give us a call to obtain your quote.

• Legal
• Residential