3 Person Mortgage

Can you have a three-person mortgage? Can three people be on the same mortgage?

Yes, three-person mortgages are very much possible. In fact, I’ve been looking at a couple of these recently. Some lenders will even consider all three incomes for affordability.

Can you get a mortgage with friends?

Yes, a group of friends or siblings can buy a house together as co-borrowers. Each applicant will be listed on the mortgage application as normal, and what you’re able to borrow will be based on your combined incomes.

How do mortgages with three or more applicants work?

Mortgages with three or more applicants work the same as any other. Each applicant will be named on the mortgage application as normal.

Some lenders will allow you to borrow more, as they will be basing their calculations on all three incomes rather than the typical two.

What deposit do you need? How much can you borrow with three people on a mortgage?

You normally need a 5% deposit on a mortgage with three applicants, which is the same as any other mortgage application.

In terms of how much you can borrow, you can normally borrow around 4.5 times your combined salaries. Some mortgage lenders will allow you to use three incomes at that 4.5 times income multiple, which means you’re obviously going to be able to borrow more than with two.

What documents do you need with three people on the same mortgage?

The requirements are the same on a three-person mortgage as for a joint mortgage – typically payslips and bank statements. If you’re self-employed, we would need tax calculations and tax year overviews with business bank statements.

Then there are the standard ID documents, such as your passport or driving licence and proof of address.

Does it cost to add someone to a mortgage?

To add someone onto a mortgage where you already own the property, yes, it can cost. You would typically have to pay the solicitor a fee to complete a ‘transfer of equity’. This normally costs around £400.

Do you pay stamp duty when adding someone to a mortgage? What other costs are involved here?

Sometimes if you add someone on to a mortgage, additional stamp duty costs can apply. It will depend whether the person being added onto the property is a homeowner already, and also how much equity is left within the property.

A solicitor will be able to advise you if stamp duty would be applicable. The other cost to consider would be the transfer of equity cost, which is around £400.