Many individuals, in Tampa Bay and throughout Florida, going through a divorce or seperation find themselves faced with the task of qualifying for a mortgage loan with alimony and/or child support income.
In some circumstances, one spouse is to be awarded alimony and/or child support as part of the divorce decree. With this income, they now may need to purchase a home, in Tampa Bay Florida, with their new source of income. When it comes to conventional financing, there are a few basic guidelines to follow to know if you can use your alimony and/or child support income as qualification for a new mortgage.
1. Alimony and/or child support must be considered as stable income for qualifying for a mortgage
The lender writing the new mortgage loan will be responsible for documenting the income as stable. Lenders do this by documenting the future payment schedule and the past receipt of said payment.
2. Alimony and/or child support must continue for at least 3 year after the date of mortgage application
Most lenders will accept a divorce decree or seperation agreement which outlines the amount of the award and the time period it will be recieved as documentation.
3. Alimony and/or child support must have been received for the past 6-12 months
Acceptable evidence of receipt of funds are bank statements, court documents, IRS Tax forms, or deposit slips. More documentation methods are available for the particular circumstances of the income.
These documentation guidelines lay out the standard qualifications for income documentation. Lenders will vary on their required documentation and you should consult your Tampa Bay mortgage professional for specific requirements.
If you are exploring your mortgage loan options as a divorced or seperated individual, contact your Tampa Mortgage Professional, Leah Ross.
~Read more information on Mortgage Qualifying on My Tampa Mortgage Blog
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Dedicated and skilled personal mortgage consultant working with a direct lender located in sunny Tampa, Florida. Expertise from luxury homes to first time home buyers.
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Leah, thank you for posting this...most buyers are not aware of the requirements for child support and or alimony. This would also apply to social security income.
Kim, thanks for the comment. Yes, social security is very similar, although a bit more flexible on the time period of receipt, of course depending on DU, etc. We have been having a heck of a time providing future receipt of income for certain disability cases...any secrets you know?
I had a loan from a buyer on one of my listings almost not go through because of alimony. Talk about throwing a wrench in the works. Took the dang think 3 weeks to close after the date they wanted for close.
I'm just still trying to figure out how to start getting alimony without having to marry someone.
Todd, ug...that's a wrench for sure! Live, learn and know for the future ;)
Chris...LOL!~ When you figure that one out, please put a post on it...I would love to know!!Good points. This is much easier to document than social security disability income. Try finding a doctor who will attest that the ailment will continue for three years! For some reason, I have had several of these loans the past few months and each one of them was a headache.
Hey Leah,
I know that I have has a few potential clients come to me and tell me that their credit is not as good as it should due divorce and they usually lay the blame on the other spouse. It seems a lot harder for them to qualify for a loan. I also run across this when leasing property. Not sure why their reputation gets tarnished because of this. I guess there might be some vengeance involved.
The Real Deal
Steven, we have been experiencing the same thing! Every time it is more difficult to please my underwriter.
Neal, the problem is that most people think because they have a divorce decree that says the other spouse is responsible for the payment (mortgage, auto, credit cards, etc.), they think they are no longer obligated. The fact is their credit is still on the line and no divorce decree will stop that.
Hey Leah,
It's good information for consumers to know, especially when they need that additional income to qualify.
Good info..
Tom Weiss
I hate asking for divorce decrees.
Looking thru one's finances is personal enough.
But I will do it if I have to
Leah, Really good post....Make sure you place that in localism.
Leah... this is some great information, because many lenders don't ask for this stuff upfront. And it can pose for some problems down the road. And I agree with Tom Burris.... I just hate asking because it's personal. But we have to do it anyhow. As long as you can calmly explain to them the whys.....
And congrats on your 1st feature.... nice job.
Leah, nice public service update, many do not know this is a recognized source of income for a mortgage loan. Nice post.
Leah - GREAT ARTICLE!!! This is more common than not for buyers these days. You just gave us all some new info to share as needed... YOU GO GIRL!!!
PS....CONGRATS on the FEATURE!!!
Another thing to remember when using child support alimony or social security is that most lenders will allow you to gross up that income by 25% because it is moneys recieved after taxes.
Leah: YAY! GO Grasshopper! Good job!
I hope this makes the Mortgage WIR ;)
Chris - try Blackmail!
Thanks for the information I didn't know all this extra stuff was included in a mortgage application... :-P
Way to Leah. one AR feature and I am sure the others did not realize that you had a localism feature the day before!
Thanks Leah....my ex would have been treated like a Queen in Florida!
Leah,
I'm glad you are handling our customers, so i don't have to know any of this; you just handle it and tell me if they will be able to get a loan.
Jack
Tom W, thanks for the comment!
Tom B, I know, it's personal, but it helps us plan for the future....ahhh...the life of a consultant
Matt, done deal :)
Jeff, thanks for the comment! Like i mentioned to Tom B, we have to do what we have to do! Thanks for the kudos on the feature!
Gary, I agree and am trying to get more information out there! Thanks for the comment~
Susie, thank you!!! And for your continued support!
Michael, thanks for the comment. Our guidelines say as long as we prove it is not taxable (via tax returns), then yes, we can gross up those amounts. Much more common with social security income too!
Anonymous Commentor ~ We do require documentation so that we can make the decision it will be "stable" in the future. I appreciate you sharing some other regulations from other areas!
David, THANK YOU!! I appreciate your feedback! Chris, you may have to start a "special" blog for the more personal topic :)
Jordan, thanks for the comment! Glad I am able to fill youir brain!
Neal, thanks for the kudos! It's shaping up to be a good week here in MortgageVille!
George, thanks for the comment! So is being a queen good?
Jack, you know I will try to tell you the whole story anyway :) I can't stop! I am happy to work with you!!
Leah - congrats on being recognized as a valuable mortgage professional here on Active Rain and Localism - looking forward to more great articles.
Well Leah....I would not know if being a Queen would feel like....LOL
This is good information that some folks forget about when it comes to getting a loan.
Great job Leah! These kind of factors aren't understood or talked about all that much, it's nice to see you outlined them and addressed them pretty darn well.
Cyndee ~ Thank so much!
Geroge, I can give you the Pricess view :)
Bob & Carolin - Thanks for the comment
Jason, thanks so much!
Leah, I sure wish I had you on my side when I applied for my first loan...
GREAT POST!
THIS IS REALLY IMORTANT mortgage informaton that people need. the misconceptions are MANY and this is some GREAT factual advise!