I am planning to buy an investment property and approached a mortgage broker. I am technically self-employed with a very stable rolling contract and my wife is full-time. My mortgage broker is asking both of us to jointly apply for a loan while the property will be in my name. Does having a loan on both our names have any effect on our future borrowing capacity? or should I insist on taking the loan in my name only? The loan in question is not huge (only around 250k).
Joint mortgage or single?
- Thread starter lincsus
- Start date
It will have an effect if either of you want to purchase separately in the future.
For eg - if your wife decides she wants to buy a property on her own, she will need to declare the full loan as a liability. And, if it's a rental, she'll only be able to claim half the income.
For eg - if your wife decides she wants to buy a property on her own, she will need to declare the full loan as a liability. And, if it's a rental, she'll only be able to claim half the income.
The reason you're probably being advised to have both of you on the loan is probably because it's your wife's income that's servicing the deal. Your own income may be stable, but might not yet be acceptable to the lender.
Ideally if the property is in your name, then your wife wouldn't be on the application as more than a few notes. If you're a contractor operating under an ABN for less than 12 months, her income may be what it takes to get the deal done.
Ideally if the property is in your name, then your wife wouldn't be on the application as more than a few notes. If you're a contractor operating under an ABN for less than 12 months, her income may be what it takes to get the deal done.
Not a good idea if it can be avoided. There is no advantage to having a non owner spouse on the loan, but 2 major disadvantages
1. Asset protecction if you cannot pay = both get sued not just 1
2. Hurts future borrowing capacity.
No negative affordability effect if you apply for future lending jointly.
