Shared mortgages - what are friends for?

Many people assume that they'll never be able to afford an overseas property. Others may be putting off their dream of a place in the sun because they can't meet the expense of the property that they really want. However, if they have a friend or family member who is also struggling to realise their overseas property purchase, then the solution might be to share a mortgage.

By adding someone else to the equation, it's possible to combine borrowing power, and the resulting joint income is something which a lender is more willing to consider. And it doesn't necessarily have to stop there - many overseas lenders will consider shared mortgages for up to four different applicants.

Shared mortgages are an increasingly popular way to buy overseas. So, instead of settling for an apartment, it may be possible to buy a villa with a pool. Clubbing together simply opens up a lot more opportunities.

Clare Nessling, Conti's Operations Director, says:
"The application process when opting for sharing with friends or family is very similar to that of getting a mortgage on your own. Obviously the mortgage lender will now have two incomes or more to take into account, so you will be able to borrow more.

"It could make sense for many prospective buyers, especially if it's for a holiday home which they're unlikely to spend more than a few weeks a year visiting. Joining forces can make a big difference to the size of the property they can afford, as well as its location and facilities. And it's still possible to rent it out for the weeks when it's unoccupied by any of its owners, therefore making the mortgage even more affordable."

Naturally, it's vital to give careful consideration to a shared mortgage before taking the plunge. It's important to think about what might happen if anything goes wrong or if someone in the group suddenly wants to get out of the mortgage. This is allowed, but can often mean added cost and their slice of the mortgage will have to be transferred to another person in the group