During the last few years the economic crisis has pushed more and more people to apply for loans and mortgages to face the most substantial expenses. Buying a car, buying or renovating a home is not something you can always do in cash. More and more often, both for personal and economic reasons, the needs lead to join forces to be able to achieve certain objectives such as buying a house. In this case it is useful that the mortgage is made out to both applicants: let’s talk about the joint loan . In this article you will find a practical guide on how to joint a mortgage.
Joint mortgage holder: who can request it
Can cohabitants joint the mortgage?
It is often assumed that only the spouses are required to apply for a joint loan . In reality anyone, in the presence of the due guarantees required by the bank, can request a joint loan. For example, a co-owner of a father, son or between cohabitants and friends. In short, the bank does not care if you are married, friends or relatives; what counts are the income requirements that must be compatible with the type of financing requested.
Why sign up a mortgage
You can decide to joint the mortgage for various reasons. First of all to make two or more people own the property but there are also other reasons. Banks often require income guarantees that a single taxpayer cannot provide, in this case cointestare a mortgage represents the ideal solution.
Joint mortgage as it works
To joint a mortgage it is necessary for both applicants to submit the same bank documents useful for signing their willingness to apply for a loan. This documentation must be certified by a notary so that both parties can be registered as the holders of the loan . In short, the procedure to be followed to request a joint loan is practically the same as for a traditional mortgage, with the difference that both applicants must submit the relevant documentation.
Joint mortgage documents to be presented
Among the documents to be presented to request a joint loan, we recall:
- Certificate of residence.
- Historical certificate of residence issued by the Municipality in the eventuality there are Protestant homonyms.
- Family status.
- Free state certificate (if single) marriage certificate (if married).
- Certificate of registration in the Register (for freelancers).
- Certificate of registration with the Chamber of Commerce (for self-employed workers).
- Copy of the tax return.
- Copy of the last 2 pay slips.
Joint mortgage with deductions
With the joint loans, the so-called passive interests are deductible at 19% up to a maximum threshold of 4,000 euros. This figure is to be distributed between the two owners of the loan, which is why we are talking about a maximum deductible expense of 2,000 euros each.
However, if, for example, one of the two mortgage holders is fiscally dependent on the spouse, he may deduct 100% of the interest payable .
Let’s take the example of two spouses who have signed a 50% joint loan agreement for the purchase of the house to be used as a principal residence. The ownership of the property is also 50% between the two. One of the spouses accepts the mortgage repayments at 100%.
How does the deduction of interest payable on this loan work in a case like this?
It is necessary to refer to Article 15 of the TUIR which establishes: if the loan relating to the main property is the name of both spouses, the deduction of the respective shares can be achieved by one of them only in the event that the other spouse is fiscally dependent on the former. Otherwise, the deduction must be distributed to 50% each.
Joint owner as sole owner
How tax deductions work in the case of a joint loan with a single owner
When a mortgage is jointly registered but the ownership of the house is not also jointly registered (therefore we are talking about a joint loan with a single owner of the property ) the matter changes with regards to the interest payable by the loan . In this case, in fact, only the person in whose name both the mortgage and the property of the building are entitled to benefit from the deductions of interest payable (50%).
Joint mortgage and home no
If, on the other hand, the mortgage is registered only to a spouse, it is possible to deduct 100% of the interest payable even when the ownership of the property is instead jointly registered.
Joint loan: death of a joint account holder
In the event of the death of one of the co-holders of a mortgage, what will happen will depend substantially on any choices that were made at the time the contract was signed. For example, if an insurance policy has been signed relating to the possible death of one of the spouses. If no insurance has been signed, the heirs of the deceased person must proceed with the payment of the installments. However it is good to remember that the banks’ interest is to receive payments regularly. Therefore, whoever will pay (in addition to the original surviving owner ) does not decide the bank but the heirs themselves.
When the succession is opened, the heirs will have to make the mortgage payable, effectively replacing the missing person. Obviously to proceed with the new heading of the loan it is necessary that everything is signed in front of a notary presenting all the documentation attesting to the effective role of heir ( moreover it is also necessary to present a certificate of the residual debt to be requested from the bank ) .
Obviously the information given concerns case studies in which the successors accept the inheritance but these can also refuse it and not incur any involvement. Furthermore, the bank reserves the right to accept or not the new holders of the loan based on the guarantees provided by the heirs.
Joint mortgage if one of them does not pay
We assume that the banks do not pose many problems when one of the co-holders of a loan does not pay the installments. For the credit institution, in fact, a missed payment is a missed payment, regardless of the responsible party. In fact, both borrowers are responsible for payments, regardless of who produces the income. Which is why the consequences could be really problematic for both parties.