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Buying your first home on one income is harder than it used to be. House prices have risen faster than wages for years, and many buyers find they can save a deposit but still can’t borrow enough to buy the home they need. A joint borrower sole proprietor mortgage, usually shortened to JBSP, is one way a family member could help without handing over a lump sum.

What is a JBSP mortgage?

With a JBSP mortgage, two or more people take out the mortgage together, but only one of them owns the property. The buyer’s name goes on the title deeds. The family member helping them, often a parent, goes on the mortgage but not on the deeds.

The lender looks at both incomes when working out how much you could borrow. That means the combined income could support a bigger loan than the buyer could get on their own.

How is it different from a guarantor mortgage?

The two are often confused. With a traditional guarantor mortgage, the guarantor promises to cover the payments if the borrower can’t, and may have to put up their own home or savings as security. They aren’t a named borrower on the loan.

With JBSP, the family member is a full borrower. Everyone on the mortgage is jointly and severally liable, which means each person is responsible for the whole debt, not just a share of it. Many lenders now prefer JBSP to the older guarantor model because the responsibility is clearer.

It’s also different from a standard joint mortgage, where everyone on the mortgage usually owns the property too.

Who could a JBSP mortgage suit?

In our experience, JBSP comes up most often with:

• First time buyers with a steady income that isn’t quite high enough on its own
• Younger buyers early in their careers, where earnings are expected to rise
• Buyers whose parents have spare income each month but don’t want to give away savings as a deposit
• Single buyers who want to own their home outright in their own name

If your family would rather help with a lump sum instead, a gifted deposit could be the better route. Some buyers use both.

What lenders look at

Each lender sets its own rules, but you should expect them to check:

• The family member’s income and outgoings. They’ll need to afford their own commitments as well as their share of the new mortgage.
• Age at the end of the term. If the family member is older, the lender may cap the mortgage term to when they reach a certain age. That could mean a shorter term and higher monthly payments. Our guide to choosing your mortgage term explains how term length affects costs.
• Credit history for everyone on the application. A poor credit record for any borrower could affect the whole application.
• Relationship. Some lenders only accept close family members, such as parents or grandparents.
• Legal advice. Many lenders require the family member to take separate legal advice so they fully understand what they’re signing up to.

The risks for family members

Being a joint borrower is a serious commitment. If the monthly payments aren’t made, the lender could pursue any of the borrowers for the full amount. Missed payments could also appear on the family member’s credit file, which may affect their own future borrowing.

The family member has no ownership rights over the property, even though they are responsible for the debt. Because they aren’t on the deeds, they may not be treated as owning an additional property. How stamp duty applies to your situation is something your solicitor or accountant should confirm, as we don’t give tax advice.

It’s worth talking openly as a family about what happens if circumstances change, such as the buyer losing their job or the family member retiring.

Coming off JBSP later

A JBSP mortgage doesn’t have to be permanent. Once the buyer’s income has grown, they may be able to remortgage into their sole name and release the family member from the loan. This depends on the buyer passing the lender’s affordability checks on their own at that point.

How we could help

JBSP products are offered by a smaller group of lenders, and their criteria vary a lot. We have access to a comprehensive range of products from across the market, including specialist lenders you won’t find on the high street. We’ll look at both incomes, the term you need and the family member’s age, then find the lenders most likely to accept your case.

If you’re thinking about a JBSP mortgage, get in touch and we’ll talk it through with you and your family. You can also read more on our first time buyers page.

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