Joint Loan – Why You Should Consider It Today
- Joint loan applications increase your chances of approval and mean you can borrow more.
- Fast and convenient application process online takes minutes.
- Pay no upfront application fees, work with trusted UK direct lenders.
Marrying is more than just having a companion; it’s about being with another person who will support you through ups and downs. Like for instance, you’re running out of funds and you ask a loan from a bank because of a bad credit. Your spouse can help you in a way where she/he will benefit as well.
Introducing joint loan – or loans given to financially-linked borrowers to purchase a car or a home, start or expand a business, or simply fulfill a dream vacation. If you’re thinking about how it works and its qualifications, this article is for you!
The term “joint” suggest the involvement of two or more people, thus with joint loans, both parties are considered as the principal borrower. Both will receive an equal amount and a fair share of responsibility in repaying the loan. In case the loan requires collateral, the property should be under the name of both borrowers. The concept is simple – since there are two borrowers, there are two incomes, thus there’s a huge source of repayment. This is ideal when the other one has a bad credit while the spouse has an excellent remark; the other borrower has a low source of income while the partner earns a lot.
Can You Get Joint Loan With Anyone?
Most people think that they can get joint loans easily, however, you cannot simply acquire it with the help of any person. Normally, it is limited to married couples, siblings, or parents. Even those who are engaged cannot proceed with the application unless they have finally tied the knot. Although there are lenders who will entertain other forms of relationship, the terms and conditions are limited, plus it takes time to find a company who will accept your request. In simple terms, only those who are bonded by marriage or by blood are the ones accepted. In case you cannot find the right partner nor the appropriate lender, you may opt for another kind of loan instead.
The loan works almost the same as guarantor loans since it involves another, but the terms of joint loans have significant differences. This option gives both borrowers the right to have the loan amount; both of them should receive an equal portion of the property purchased by the loan; both parties will share the burden of repaying the debt to the company.
The cosigner from a guarantor loan, on the other hand, will only need the other person to vouch for the loan seeker and guarantee his debt. This means that he shall take the responsibility of repaying the loan in the event of default.
Whatever type of loan you choose, be sure to protect yourself and your partner/guarantor by signing up your own agreement. Not all those who take joint loan or guarantor loans do this but this is one way to avoid any conflict or disagreement. You can consult a financial advisor to guide you in this case. Only a few people see this essential until an unfortunate event arrives. For instance, a married couple went downhill and decided to have a divorce but since both parties have signed up and agreed to settle the loan, whatever happens, they are still obligated to follow the terms.
Advantages And Disadvantages Of Joint Loan
Almost everyone dreams of having their own home but sadly, only a few can shell out a massive amount to buy a property. In such a case, having co-signer may increase the chance of getting a home loan. While this type of joint loan has various advantages, it carries a few disadvantages too. Therefore, before you commit to a new loan contract, you must weigh all its pros and cons first.
Joint loan, when applied with a parent, siblings, or a spouse, increase the cash you can avail; the higher the income, the bigger the chance of taking home a massive amount of cash. Also, in case of secured joint loans, both co-applicants can claim tax deduction benefits. The principal repayments and interest paid are qualified for taxable income, thus reducing the overall liability for the debtors. Furthermore, it’s not necessary for both borrowers to contribute equally. Both parties can decide how much they can contribute to settle the loan and its interest.
Joints loan sound promising but it has a few downsides as well. One of which is the delay in the documentation. Since there are more than one applicants, the bank or the loan provider will take a longer time to process the documentation. This is to ensure that the documents provided are accurate and not forged in anyways, and to verify the credit history of both parties. Also, since joint loan give the debtors the flexibility to decide how much they are willing to give for the loan, there’s a chance for default or late payments. If they’re not able to pay the loan on time or worse, decided to default, both of their credit histories will be affected. Therefore, it’s advisable for both applicants to assess their capability first. If one cannot handle the loan effectively, affecting the other party’s finances, then it’s best to look for another option, or at least settle for a lower loan amount.
Overall, joint loan has more pros than cons, and it’s up to the loan seekers to ensure that they make the most out of the advantages and avoid its drawbacks.
How To Apply For Joint Loan?
Loan seekers of joint loans may go with the traditional application – visiting a lending office. They may also apply over the phone, or by submitting an application form online. Online joint loan and other types of online loans have a similar application process which requires filling out an application form. However, since it will provide a bigger amount, additional documents may be necessary. You can call the lender’s customer service to clarify all their requirements. For the meantime, these are the basic things you need to provide.
- Personal details, including the full name, birth date, email addresses, mobile numbers, etc.
- Employment details, including your income, job position, company name, etc.
- Financial details, including the checking your bank history, credit report, etc.
Joint Loan FAQs
How do I apply for joint loans?
You can apply in conjunction with your parents, sibling, spouse or partner and all applicants will have equal access to loan funds. To get started simply complete our short form online.
Can I apply for higher amounts?
In some cases, you may be able to apply for higher amounts of money with joint loans than if you had to apply as an individual. To see how much you can lend just complete our short form.
How fast will we have the cash?
You will usually be able to obtain the cash on the same day your application has been approved. Larger amounts might take longer to process.
What can we use joint loans for?
Anything you like, from a paying for emergency car or home repairs to booking a much-needed weekend getaway. You can even use them to consolidate loans and debt if needed.
Will we need a guarantor to apply?
No. Numerous lenders will be willing to work with you and not require a guarantor when applying for joint loans.
Can we apply with bad credit histories?
Yes. Loan companies are now more willing than ever to try and assist individuals who have a bad credit history, so you can still apply. You still need to prove you can make the repayments however as part of responsible lending.