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What is a joint loan?

A joint loan (or shared loan) allows you to borrow money with another person you trust, such as a partner, relative, or close friend.

How do joint loans work?

A joint loan can help pay for large purchases, such as a new car, or cover the costs of home improvements. Together, you may be able to borrow more money than you could by yourself.

But taking out a joint loan requires careful thought. You’ll be responsible for paying it back in full – not just your half. 

What types of loans can be joint?

Many loans can be taken out jointly. These include secured loans, such as mortgages, and unsecured loans, such as personal loans, wedding loans or debt consolidation loans. You can also open a joint bank account with an arranged overdraft. 

Credit cards, however, can’t be taken out jointly. There is a main cardholder who is responsible for paying off the credit card. You can add another cardholder to use the credit, but they won’t be legally responsible for making payments.  

Explore: Secured vs unsecured loans explained

Things to consider

Here are some things to consider before taking out a joint loan:

You have to meet your monthly loan repayments

You must repay the loan each month, even if your financial situation were to change – so factor this into your budget

Missed loan repayments can affect your credit score, and your ability to borrow in the future. Your home could also be repossessed if you fail to meet your mortgage repayments. 

You're responsible for paying back the loan in full

You’ll be responsible for paying back the total amount of the loan – not just your half. So, if one of you fails to pay, the other person must repay the loan each month.

Even if your partner spent the money or owns the item(s) purchased using the loan, you’re both still responsible. 

Loan repayments still need to be made after a separation

A relationship breakdown can be difficult and may affect your finances. Repayments on joint loans, including mortgages, still need to be made after a separation. Although, it’s worth letting your bank know if you’ve separated. 

A partner’s poor credit history can affect your own

When you have a joint loan or joint debt with someone, your credit history will be linked to theirs. If you decide to borrow money in the future, in your name, the lender can take the other person’s credit history into account – not just your own.

It’s a good idea to check your credit report before you apply and ask your partner to do the same. 

There may be fees and charges

Before taking out a joint loan, make sure you're both aware of the terms and conditions of the loan, including any fees and charges. 

Before you apply

Check that all your information is accurate, including the details in your credit report. And make sure you only apply if you feel comfortable taking out a joint loan with the other person.

How to apply for a joint loan

The easiest way to submit a joint loan application with us is to visit your local branch, where our staff can help.

Find your nearest HSBC branch