What is a booster mortgage (joint borrower sole proprietor)?
Reading time 5 minutes
At a glance:
A booster mortgage is where two people apply for a mortgage, but only one person owns the home.
A lender could allow one person to borrow more when they combine their income with another person.
Both borrowers are responsible for the mortgage repayments, but only one person actually owns the property. It’s also called a joint borrower sole proprietor mortgage (JBSP).
How does a booster mortgage work?
A booster mortgage allows one person to have the borrowing power of two. With this type of mortgage, two people will be jointly responsible for repaying the mortgage.
Only one person is named as the legal owner of the property. A lender will look at the combined incomes of both people, so could agree to lend more money to buy a home.
It’s another name for a joint borrower sole proprietor (JBSP) mortgage.
This type of mortgage can be useful when one person cannot borrow enough on their own. Another person, like a family member, may agree to support the application by becoming a joint borrower.
Here is how it typically works:
One person is the sole proprietor. This means they own the properly legally.
Two people are joint borrowers. Their income is included when deciding how much a mortgage provider might lend.
All borrowers are jointly responsible for making the mortgage payments.
It might be possible to remove the second borrower later if the owner of the property can handle the repayment by themselves.
Example of a booster mortgage
Charlie needs a mortgage but doesn't earn enough to borrow the amount they need. They can use their mum's income to boost theirs, which lets them borrow more.
Combine incomes: We use Charlie's income plus Charlie's mum's income for the mortgage.
Shared responsibility: Both Charlie and their mum are liable for the mortgage. This means they both need to make sure the mortgage is paid.
Ownership: Charlie owns the property, and only Charlie’s name is on the title deeds.
What’s the difference between Mortgage Booster and a guarantor mortgage?
A booster mortgage is different to a guarantor mortgage. Here are the key differences:
Mortgage Booster
You and your family member are both named on the mortgage.
You're both liable to pay the mortgage.
Only you own the property and are on the title deeds.
Your family member has no legal claim on your property.
Guarantor mortgage
Only the homeowner is named on the mortgage.
If the homeowner can't or doesn't pay the mortgage, the guarantor is liable to pay the mortgage.
Only the homeowner is named on the title deeds.
The guarantor has no legal claim on the property.
Benefits and considerations of a booster mortgage
Benefits
Borrow more: Two incomes means you’ll likely be able to borrow more. This can help if you don’t have a big income.
You own the property: The main borrower owns the property and can make all the decisions about it, for example, selling in the future.
Considerations
Missed payments impact all borrowers: Failing to keep up to the repayments will impact the credit history of both borrowers.
Income isn’t all a lender will look at: If the main borrower fails a lender’s affordability checks, they may still not be offered a mortgage.
Impact on future borrowing: The joint borrower may be more limited with their ability to able to take out extra loans or another mortgage.
The content on this page is for reference. It is not financial advice. For help with money issues, try MoneyHelper.
