Joint accounts are great for housemates and couples who need to share money, or in order to pay bills from a single account. Before you begin the process of signing up to a joint bank account, here's the things you need to think about..
How to open a joint account
The process of opening the account is almost exactly the same as opening a solo account.
Any named person will need to fill in an application form and provide proof of address and identity. You'll also need to sign a mandate when you open the account, agreeing to any permissions and authorities set up on the account.
Am I eligible for a joint account?
If you have a permanent address in the UK, and are over 18 then you’ll be eligible for most joint accounts.
If you’re applying for a joint account with an overdraft, then your bank will carry out a credit check on everyone who is planning to have access to the account. If those you’re sharing an account with have problems on their credit report then this may impact your chances of securing an account with an overdraft facility.
Who can access the account?
Any named person associated with the account will be able to access it, transfer money in and withdraw money out.
If you’re the sort of person who likes more control over their account, then look for a one that allows you to set some rules and restrictions. Some accounts can be set up so that permission must be requested from each named person before a transaction is made.
What does a joint account mean for my own finances?
Living with someone or getting married creates a 'financial association'. The same association is made when you jointly apply for financial products, including a joint account. What this means is that lenders can take the other person's financial conduct into consideration when deciding whether or not to grant you access to certain products.
It's important to make sure that whomever you open an account with has a good grip on managing their money because it can impact your ability to secure affordable finance in the future.
How to handle disagreements with account holders
It happens. When it comes to mixing money and people who are close to us then there’s the chance that you might have disagreements. If you do experience this, then you have the right to freeze the account which means that no-one, including yourself, will be able to withdraw any money from the account.
The bank will unlock the account once an agreement has been reached by all the relevant persons. Worst case scenario, when an agreement can’t be reached, then courts can help settle disputes.
If one of you dies
When someone dies with a jointly owned bank or savings account, the survivor automatically inherits the deceased account holder’s save of any money held in the account, so make sure you don’t hold too much money in a joint account if you wouldn’t want the other person to inherit upon your death.
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