One way to increase your credit standing is to join other people with your loan. Such an additional borrower need not be the owner of the purchased property. In most banks, it is sufficient that they only take out a loan.
However, it is worth remembering that … most often it must be a person related to or running a joint household with the buyer and the main borrower. An additional borrower, although he will not always be a co-owner of an apartment, takes a loan on the same terms as other people.
A mortgage is a joint and several liability, which means that all persons who sign the contract have the same rights and obligations. Regardless of the proportion of income, everyone is fully responsible for the installments paid. There is no possibility of a formal division, so that e.g. one person is responsible for paying 70 percent. loan and the other borrower only for 30 percent.
However, not always the additional borrower will increase creditworthiness. In extreme cases, the capacity may be reduced. By adding more people to the loan (e.g. parents), the bank will treat these people as a separate household. Assuming certain costs of maintaining an additional farm, the bank will calculate the appropriate amount on the liabilities side, e.g. PLN 1,200. If the income of the additional borrower is not too great, it may turn out that, assuming the cost of maintaining two households, the creditworthiness decreases.
If the additional borrower has any other obligations
this will also reduce the maximum loan amount. In the process of analyzing the application, the credit history of all persons taking a loan is also examined. Thus, an additional borrower, even if he does not own the property, must have an acceptable credit history.
When adding more people to a loan, e.g. parents, we must be aware that these people can shorten the loan period. The loan must be repaid most often before the age of 70 of the oldest borrower, so if a person, e.g. a 50-year-old, joins the loan, the maximum repayment period cannot be longer than 20 years. It is worth considering, therefore, whether it is always reasonable for older people to join. It can have the opposite effect.
Pay off liabilities
Another way to increase the available loan amount is to pay off part of your obligations. Of course, if we repay another housing loan or a loan of tens of thousands, it will not be that easy. However, we often have relatively small amounts of loans or credit cards that reduce creditworthiness.
The installment of the TV loan or other installment purchases are often small amounts, but when added up, they can significantly affect the amount of the new loan. We should also remember that for debits the installment of the repaid loan is taken in the same way if there are 3-4 months to the end of repayment and the same when we have several years to complete the repayment. Therefore, if the debt balance is relatively small, it is worth paying off loans and credits ahead of schedule in order to increase your credit standing.
A simple ordering of finances can also have a positive effect. Credit cards are counted as liabilities regardless of their level of use. If we have high limits and in practice we use only a small part or we don’t use them at all, then either close the card or lower the available limit. We can also do this in the case of revolving loans in your account, which will result in increased creditworthiness.