A joint loan is a loan taken out by at least two people. The most common type of joint loan is a mortgage. However, there could be various other loans that could be applied for jointly, such as personal loans, secured loans, car loans and the like. It is not necessary to be married to apply for a joint loan. You can do it with your friend, sibling or one of your parents. However, joint loans are most commonly sought by married couples when buying a car or getting onto a property ladder.

Joint loans are normally suitable to fund large expenses so that you can borrow larger sums at affordable interest rates without a hitch. If one of you has a below-average credit report, it still provides a chance to get the nod for the loan. To sign off, a lender will carefully peruse the credit report of both parties and remember that you both are responsible for repaying the debt in full if the other fails to comply with the obligation.

Default of missed payments will be communicated with credit reference agencies if you both fail to adhere to the payment schedule. Joint loans for married couples will show you an advantage. Since lenders do not have to bank on only you to get their money back, interest rates will be quite lower, and the approval rate will also be higher.

A joint loan’s effect on your credit score

At the time of taking out these loans, a lender will run a credit check for both applicants. This will be a hard credit check, so you will see a slight drop in your credit points. The damage is temporary because your credit score will bounce back as you start making payments on time. However, it does not suggest that you apply to multiple lenders, as this will wreak havoc on your credit points, lowering your chances of getting the nod for a loan. 

Applying for a joint loan means your credit report is linked to the other applicant. So, whether or not payments are made, the impact will show up on both credit reports. Though these loans come with some sort of convenience, you will be at risk if you take out a loan with someone with a bad credit score, and these effects will show up when you apply for a loan individually. Your lender will assess your risk by checking the records of both. This can influence their decision.

What are the merits and demerits of joint loans?

Each loan comes with certain advantages and disadvantages. Here are they:


  • Chances are you get a bigger sum of money.
  • Your chances of getting the nod for a loan are quite higher, even if one of you has a not-so-impressive credit score.
  • As the payments will split up, it is way easier to adhere to payments.


  • You cannot escape the responsibility of paying off the full debt when your partner fails to do so.
  • As your credit file will be linked, it might cause some difficulty getting approval for a loan if your partner has a poor credit score or misses any payments.
  • Missed payments will be recorded on the credit files of both of you.
  • You will continue to bear the debt burden even if your partner dies.
  • You cannot get rid of a joint loan unless you settle in full even if you have parted ways.  You will still have to work on payments and both accounts will stay connected.

How to apply for joint loans for married couples

First off, you both should sit together and take a view at each other’s financial situation. Discuss your finances. Not to mention, you will have to change your spending habits as well to some extent to be on the same page. In the event of a poor credit rating, do it up.

Discuss your borrowing needs and then determine your affordability. You will need an online calculator to estimate the sum. There is no point in borrowing more than your affordability. Compare lenders’ interest rates and associated fees. Bear in mind lenders do not maintain transparency with rates they show on their websites, so be ready to be charged more.

Contact the lender’s customer support team and ask for the documents you must submit. You can get such details on the website as well. Fill in the application form and then submit the documents. Do not be tempted to conclude that you have been turned down because joint loans for married couples are not such small loans. A lender may take a couple of days whether to sign off on or not. The lender will inform you even if your application is not successful.

If not, try the loan from another lender, and you will get a contract if it is successful. Read all terms and conditions carefully. Sign in and submit the agreement. You will get money into your account and are obliged to pay it off from the moment you get it.

The bottom line

Joint loans for married couples could be a great help, especially if you need a larger sum. They increase your chances of getting lower interest rates, but they also have a few drawbacks.

Your credit report will be linked to your partner, and it can affect your borrowing capacity on an individual level in case any instalment is missed. It is always recommended that you carefully weigh all merits and demerits before applying for joint loans for couples.

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