For many, the path to homeownership can be straightforward: save for a down payment, find a property, and secure a mortgage.

But for others, the latter step isn’t always quite so easy. A low credit score or difficulty saving for a down payment can quickly get in the way of affording a mortgage alone. One option that can make it more accessible is a joint mortgage. Here’s a closer look its intricacies and distinct benefits to help you better determine if it’s the right choice for you.

What it is

Just as it sounds, a joint mortgage is a home loan that’s shared by two or more people. Each person involved is listed on the mortgage and shares equal responsibility for ensuring that it’s paid every month. This process allows you to combine your financial resources with others to mitigate your risk factor in the eyes of a lender. With all your incomes and credit history factored in, you may be better able to get the loan you need to purchase a property and become homeowners together.

It’s important to note that getting a joint mortgage differs from having a cosigner, who is typically someone who doesn’t live in the home but is still liable for the debt. It’s also not the same as having joint ownership, which involves listing all parties’ names on the property’s title.

Who it’s for

Almost anyone can apply for a joint mortgage, including married and unmarried couples, parents and children, and friends. There are just a few specific requirements to keep in mind: everyone has to be eighteen or older and you have to meet the minimum mortgage criteria, including for debt-to-income ratio, credit score, down payment, and loan-to-value ratio, which compares the amount you’re borrowing to the value of the property.

A joint mortgage can be ideal for situations where one person’s income or credit alone would not be sufficient to qualify for a mortgage. But if yours are good, joining up with someone who possesses equally good financial standing can also potentially qualify you for a higher loan at a better interest rate.

How it works

When applying for a joint mortgage, each person must complete a mortgage application. The lender will then consider the income, credit scores, and overall financial situations of all applicants. However, if one person has a poor credit score, it could affect the mortgage terms, such as the interest rate offered.

Once the application is approved, each person will be listed on the home loan, making them equally liable for the mortgage. From there, ownership of the property can be structured in different ways depending on your specific situation. For instance, you could opt to add everyone to the title if you and the other person are married or in a committed relationship, while you may want to keep it under one person’s name if the others involved won’t be living there long-term.

The benefits

As noted above, one of the primary benefits of a joint mortgage is the increased borrowing power that comes from combining financial resources, which can allow you to afford a more expensive property at a more favorable rate. Additionally, the financial burden of homeownership will be shared, making it more manageable for everyone involved.

The risks

While there are clear benefits to a joint mortgage, there are also certain risks worth considering. Because each person listed on the home loan shares liability, if one person can’t make their share of the payments, everyone else is responsible for covering the difference. This shared liability also extends to credit impact; if payments are missed or late, it can negatively affect everyone’s scores. Further, a relationship change between parties could complicate the situation, especially if one person wants to be removed from the mortgage. And if there is only one owner, they could still sell the property, even if the others on the mortgage don’t want to.

A joint mortgage could be an excellent option for you, making homeownership a more viable possibility than you realized. For additional details about joint mortgages—including their potential benefits and risks—as well as other steps of the homebuying process, get in touch with a trusted real estate agent and mortgage advisor.