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Joint mortgages

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Where two or more individuals take out a mortgage together then the loan is usually referred to as being in ‘joint’ names.

There are a number of matters which affect joint loans which can be important. You should keep these in mind when you are taking out a joint loan.

Liability for your mortgage

If you have a joint loan then your liability for the loan is ‘joint and several’ with the other borrowers. This means that each of you is liable for the whole amount borrowed as though the loan was in your name only. If you are unable to maintain mortgage repayments and the account goes into arrears we will try and help you, see section on Arrears on Your Mortgage. However, where we are unable to secure repayment of the arrears and as a last resort, the property may have to be repossessed.

We will use the sale proceeds to repay the loan. However, if the proceeds are not enough to do this then YOU remain jointly and severally liable for the shortfall. This means that you may have to pay some or all of the amount of the shortfall. If you pay it all then you may have certain rights to recover part of this from the other parties to the loan. Your solicitor or local advice centre will be able to tell you about this.

The Society's staff will be able to tell you about your liability for your loan in general terms. If you would like a more detailed explanation of your liability and our rights to recover the loan then you should speak to your solicitor or local advice centre.

Divorce or separation

If you take out a loan with your husband, wife or partner then you will remain jointly and severally liable for the loan even if you move out of the property because of a divorce or separation.

The person who remains living in the property may want to take on the loan on their own. However, we will only agree to this if we are happy that they can meet the monthly repayments. If we do not think that they will be able to do so then we will not remove your name from the loan and you will remain liable for it.

As part of a divorce settlement or separation agreement there may be a court order or other arrangement which transfers ownership of the whole of the property to only one of the parties to the loan. However, this does not alter the liability of the parties to the loan for us. We may alter the loan as a result of the transfer but this will depend on whether we are satisfied that the person who will be taking on all of the loan will be able to meet the monthly repayments.

Death

As recommended in the earlier section we would always suggest that you consider life cover for all parties to the mortgage. If one party to the mortgage dies the remaining borrower becomes responsible for ensuring that the monthly repayments are made. We will remove the deceased borrowers name from the loan once we have seen a certified copy of their death certificate. When the last remaining borrower dies we will handle the loan as described in the earlier section on death