Is it possible to get a mortgage without being married?

A mortgage for an unmarried couple ("na kocią łapę")

Have you been together for several years? Has your professional and financial situation finally stabilised? Are you slowly thinking of buying a flat together, but do not feel the need to formalise your relationship yet? Is taking out a mortgage in such a situation even possible? Of course it is. Nowadays you do not need to change your marital status just to get a loan. What does the procedure for obtaining one look like for unmarried couples? You will find the answer in today's article.

An informal relationship and a mortgage

In the eyes of the law there is no obstacle to an unmarried couple taking out a mortgage together. Difficulties can arise when dealing with the bank. These institutions fall into two groups: those that grant home loans only to married couples, and those that take a more liberal approach on this issue. Fortunately, present times and attitudes to relationships are forcing banks to relax their restrictions, so there are few institutions left that require confirmation of marital status before granting a loan.

How a bank treats spouses is a separate matter from how it treats people living together as cohabitees. For this type of institution, an unmarried couple is two separate households and will be assessed as such even if they decide on a joint mortgage. A married couple, on the other hand, is treated as one household. What difference does that make? A decisive one for the size of the property loan. Banks believe that the cost of maintaining one household is lower than in the case of two separate ones, so they will be inclined to grant a higher loan to people who earn the same but are married. Fortunately, there is a way out of this situation. Unmarried couples can provide the bank with a certificate of running a joint household, which will increase their chance of a larger loan.

What does the size of a mortgage depend on?

Everything depends on the partners' age and their creditworthiness. Before the bank decides how large a loan, and for what period, it can grant you, it will take these two variables into account. If you are of a similar age and earn similar amounts, the matter is fairly simple. It is different when one of the partners is considerably older. In that case the bank may decide to grant the loan for a shorter period. In turn, if one of you earns considerably less, this may lower your joint creditworthiness.

And what if you split up?

Unfortunately, it is never possible to predict whether a given relationship will last, and not even marriage guarantees that. So whether you split up as an unmarried couple or divorce after having been married, the rules for repaying a flat loan remain the same. If you took out the loan together, then even after the break-up you are obliged to repay it jointly. Of course, the amount of repayments does not have to be the same for each of you; it all depends on how ownership was divided at the time the loan was taken out.

It is also worth remembering that if one of the former partners fails to meet the repayments, this obligation passes to the other party. You are both bound by a joint and several liability clause, regardless of whether you were married or not.

And what about the property?

After a break-up you can sell the property and use the proceeds to repay the loan. Another possibility is for one partner to buy the other out. The former then takes over ownership of the flat. Whichever solution you choose, you are obliged to notify the bank.