Is it preferable to apply for a mortgage as a couple or is it better for me to do it alone? The answer to this question depends on many conditions: the legal situation of the cohabitants (married or common-law partner), economic regime in the case of marriages, employment situation …
Each situation has its advantages and disadvantages. We tell you what they are.
Apply for a mortgage as a couple
If you are thinking of applying for a mortgage with your partner you should know that your candidacy has added some points for the bank. Financial institutions consider that the risk is lower when the recipients of the loan are two.
It is logical, because the debt will be paid with the income of both. In addition, in the event that one of the holders fails, the other can take care of the payment of the fees.
Why should you apply for a loan as a couple?
- The amount that the bank will give you will be higher when there are two payers. The conditions are also usually better than if the loan were granted to a single person.
- It is always easier to pay the fees when there are two payers. But remember that you are both responsible for the payment.
Is there a difference between being married or not?
In the case of marriages, the difference is whether the property regime is community property or separation of property.
In the first case, the appearance of both in the bank is mandatory to apply for the loan. In addition, from the legal point of view, both the loan and the house belong to both members of the marriage.
If the couple is not married or the matrimonial regime is one of separation of property, the presence of the two is not legally mandatory. Of course, for economic purposes things change.
Whether you are married or live as a couple, it is best that before applying for a mortgage you establish with the other a series of premises in case of separation and that these are raised to public deed. You will save yourself a lot of headaches in case of rupture.
What happens to the mortgage in case of divorce or separation?
There are several options, depending on who owns the mortgage and the home, whether there is an agreement or not, etc.
If you both own the home and also mortgage holders, several possibilities open up:
- Sell the house and pay off the mortgage,
- Transfer ownership to one of the spouses,
- Negotiate with the bank the dation in payment,
- That it is the judge who determines the use of the dwelling for one of the spouses,
- Assume the mortgage payment between the two, etc.
If finally one of the parties keeps the house, it is essential to know in which regime it has been bought: in condominium, proindiviso or through a community of property. In the first case, the distribution is easy because the part of each of the spouses is divided into percentages. If it is done through a community of property, these percentages do not exist so its liquidation will be more complex (first the company is liquidated before a notary and then the house is awarded to one of the members of the couple).