Does buying in partnership improve serviceability?

If I was to buy a PPOR with my girlfriend, would this increase serviceability for me? Or would the bank still see me as responsible for the whole loan if something went wrong?

Can my girlfriend and I buy in partnership if I'm throwing in all the money for the deposit and most of the repayments?

Thanks

 

Does your girlfriend have a job and income?

 

Yes it will as you will have 2 incomes
But consequently if you buy separately it could hinder that.

 

#notabroker #notanaccountant

Whenever I've bought in partnership both parties where 100% liable for the debt and only 50% able to use the rental income for serviceability.

Edit: sorry I thought you meant would it decrease my serviceability for future buys. If you mean does it increase the amount we can borrow for that one deal then yes.

 

It potentially increases your servicing assuming your GF is working and doesn't have a high about of liabilities.

However the issue is that in the future most lenders (with the exception of a small number) will look at the entire debt against your name and only half of the rental income if you were to ever turn the property into an investment.

 

Hi guys, to clarify I did mean to ask whether it would affect serviceability for future purchases.

For eg if we purchase a property together valued at $1mil in partnership (don't know exactly how this works if I was throwing in the whole deposit and most of the repayments), would it be better for future purchases than if I was buying it only in my name? It will be a PPOR, not an investment.

Cheers

 

If you are 50/50 owners then you would be assessed as receiving 50% of the rent..
But because of joint and several liability you are considered liable for the full debt.
So this will hurt serviceability in future if you go separately on loans.

There are at least 4 lenders that will assess you on your share of the debt based on ownership % with Joint Tenancies considered equal owners

 

Putting it another way, Terry, is there a specific way of buying PPOR as a married/defacto couple that makes a difference to future borrowing capacity?

 

Yes, many ways really, all varied depending on the circumstances.

 

If she earns an income - yes.

Cheers

Jamie