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Buying a Home with a Friend With lenders now enforcing strict criteria when it comes to getting a mortgage, and house prices being slightly out of reach for many people, it is no surprise that lots of people are now choosing to team up with friends or family to buy their first home and get on the property ladder. This has many advantages and can help to raise a larger deposit as well as make repayments more affordable, however there are things to watch out for as you could easily become liable for the entire mortgage if the other person defaults. You can also split the costs with up to three other people to split the costs even further but obviously that means you will only have a 25% share in the property. Any person that has joint ownership of the property has a legal right to live in their home, so it’s also worth bearing that in mind when looking to buy a house with others as you may not have the privacy you hoped for. There are many things to be aware of when choosing to become joint owners of a property. You all need to agree on anything that happens with regards to the property. Whether that is making any cosmetic or structural changes or even getting a loan against the house, everybody needs to agree or give consent before anything can be done. There are a few different types of tenancies for ownership. Joint tenancies tend to involve married couples whereas tenancy in common is something involving a group of friends or family who choose to come together to purchase a property. Make sure you are prepared for any circumstances changing and understand your rights and responsibilities as a joint tenant. For example with a joint tenancy if anything happens to one of you, then your home will automatically pass onto the other owner, which means that your share of the property cannot be inherited by anyone else after you die. However if you have a tenancy in common and therefore share a mortgage with up to three other people, you can act independently from each other, allowing your share to be given to someone in a will. When it comes to mortgages with your partner the same will apply unless only one of you owns the property outright. In this case your partner would not have any legal hold over the property unless you were married and then their rights are slightly different. Whatever the situation you are best to gain legal advice in the event of any dispute regarding the property. Similarly if you have any disputes with other joint tenants you need to be aware of your rights. So it is extremely important that you are happy to commit to purchasing a property together as many people end up in court by not considering many simple issues such as development or residency. Remember everyone is responsible for paying the mortgage, and if anyone defaults the responsibility will lay with all of the tenant’s not just one.

by Cormac Henderson

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