Benefits of Purchasing Shared Housing with a Joint Mortgage

In the past, the most common homeowner categories were a married couple or a single person. However, nowadays, it's becoming more common for family members or friends to buy a property together and apply for a loan jointly. So, what are the advantages and disadvantages of entering into this kind of arrangement? And what are the legal consequences? This article will explore different scenarios where a joint mortgage could be a good or bad decision and explain the process of applying for one.

One reason people might consider shared housing with a joint mortgage is to meet their non-traditional housing needs. According to Aaron Dorn, the chairman, president, and CEO of Studio Bank in Nashville, Tennessee, shared housing provides a great option for those with unique housing requirements. He mentioned that there is no one-size-fits-all solution for housing, and various factors can influence what type of housing is best suited for a situation. For instance, friends currently sharing an apartment may find that buying a home together could result in lower monthly payments compared to renting. Additionally, joint mortgage arrangements can enable individuals who cannot afford a mortgage payment on their own to collectively pool their resources and make the home purchase feasible.

Another common scenario where a joint mortgage might be advantageous is when couples who are not married wish to buy a home together for similar reasons. Families can also benefit from joint mortgages, especially in the case of multigenerational housing becoming more prevalent due to people living longer and pensions disappearing. Moreover, shared mortgages can be beneficial for those looking to purchase a secondary residence or an investment property to generate additional income. For instance, families and friends might join forces to acquire a vacation home where they frequently visit, making it a more affordable, convenient, and secure option than staying in a hotel.