3 Person Mortgage
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3 Person Mortgage
Can you have a three-person mortgage? Can three people be on the same mortgage?
Absolutely. A multi-applicant mortgage has three or even up to four mortgage applicants. That’s opposed to a traditional joint or a sole mortgage application where one or two people apply.
Can you get a mortgage with friends?
Yes, it’s feasible. There are restrictions – some providers only lend on this basis if it’s family members. However, other lenders will definitely consider a group of friends. There are just fewer lenders to choose from.
How do mortgages with three or more applicants work?
In principle, this type of scheme is no different from any other joint or sole mortgage. An application is made based on three individual applicants and their incomes.
The property will generally be owned in equal shares. However, different percentages can be allocated by setting the ownership up as ‘tenants in common’ – so you don’t have to own a third each.
It could be that somebody’s putting in more deposit than somebody else. They could then own a slightly larger percentage of the property than the others.
What deposit do you need and how much can you borrow with three people on a mortgage?
Deposit levels tend to be the same as for any other mortgage. For a mortgage with three applicants, typically the minimum deposit required would be 5%.
However, with a higher deposit you’re lowering the Loan to Value, which can mean a lower interest rate. That leads to lower monthly payments. A lower Loan to Value means there’s less risk to the lender – and therefore the better the rates you will get.
What documents do you need with three people on the same mortgage?
It’s just the standard supporting documentation, such as proof of income. If you’re employed, we need the latest three months’ pay slips, or if you’re self-employed it’s the last couple of years’ tax calculations and overviews.
Typically, lenders want to see three months’ bank statements from all three applicants, proof of ID and current address plus proof of the deposit and where that’s coming from.
Does it cost to add someone to a mortgage?
At the point of an initial application, no. If we’re buying a property today with two, three or four people, there’d generally be no additional costs.
But where a couple of people already own a property and want to add someone else to the mortgage, that’s a different scenario. Adding somebody in would require a new mortgage application, underwriting and conveyancing.
It would include a ‘transfer of equity,’ where the new person is added to the property deeds, and typically the cost from a conveyancing perspective would be around £300 to £400.
Do you pay stamp duty when adding someone to a mortgage?
Stamp duty transactions can be complex and will depend on the individual circumstances. In this type of situation, I’d recommend seeking professional advice. Speak with us as a broker, but equally talk to an experienced property conveyancer – because situations do vary.
In a lot of cases, stamp duty wouldn’t be payable, but not always. We’d have to look at the individual circumstance.
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Are there any other costs or fees we need to know about for a three-person mortgage?
It’s no different from a standard mortgage. Obviously you’ve got your legal fees to take into account. There could be lender fees, including a valuation fee and an arrangement fee. Those differ from lender to lender.
In some cases, there may be no fees. In other cases, especially if it’s a more specialised mortgage, there may be fees to pay. It’s all down to your own individual circumstances.
Talking to somebody like ourselves can establish exactly what you want to achieve.
If you’re looking to avoid certain costs, we can try and find a lending solution to provide the right outcome.
What are the pros and cons of having three people on a mortgage?
The key things are the option to possibly raise a larger deposit, and more quickly. It potentially opens the door to borrowing more, because there are additional people on the mortgage contributing their income. The lenders also tend to be more generous in what they’re going to allow you to borrow.
You’ve got shared responsibility for mortgage and bill payments, so you’re not on your own. There’s three of you involved here, and that can ease the financial burden.
You could possibly achieve home ownership more quickly, by pooling deposits. Getting that increased affordability could get you onto the housing ladder more quickly. It’s also helpful to share costs such as stamp duty and legal fees.
The main downside is around how the property is owned. It’s an important consideration. If somebody doesn’t want to be part of the mortgage any more and wants to be bought out, how will that work? It will mean a new mortgage application.
Which lenders offer mortgages to groups of three or more people?
We’re starting to see a change here, with a significant number of new lenders entering this market. A lot of them are looking at more niche lending pockets – and mortgages with three or more applicants is one of those areas.
Typically, it’s lenders such as Metro Bank, Leeds Building Society, TSB, Skipton and Coventry that tend to deal with this type of application. But watch this space, as more lenders are coming into it [information correct at the time of recording in March 2025].
How can people get a multi-applicant mortgage? What’s the process?
We’d always suggest the first step should be to find and speak to a broker such as ourselves. We specialise in arranging mortgages in this particular area.
To get approved for a multi-applicant mortgage where all parties’ incomes are declared, speak to us. We have existing relationships with most lenders, whether you’re a group of friends or family members looking to buy a property. We can maximise your chances of success, and take the stress out of the whole transaction.
Other benefits include providing relevant advice, obtaining an Agreement in Principle, submitting an application on your behalf and then liaising with the lender to secure that mortgage offer. It’s offering that helping hand.
When you’re starting out on this journey, it can be really daunting. There could be all sorts of issues. The property may have problems from a valuation or a structural point of view. It’s so important to have the right support mechanisms around you to get you through that – and that’s what we’re here for.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP WITH YOUR MORTGAGE REPAYMENTS.
