Everyone knows that getting a mortgage in
the current economic climate can be like pulling teeth. Banks have tightened
credit requirements and now demand proof verifying all aspects of your
financial life. It’s understandable then why people would think that a divorce
and all the financial mess they lead to would make buying a house all but
impossible. Thankfully, if you want a home there are ways around the problems
if you’re willing to follow some advice.
According to a recent Yahoo piece, the
key to getting a mortgage after a split is in providing the most full picture
of your financial life. You have to assist the bank in understanding your
financial situation by showing them your divorce decree, any and all child
support obligations and any spousal support payments that go in or out of your
accounts. All these things can play a role in whether you will be approved for
a loan and it’s best to hand them all over to your banker right away.
The good news if you receive money in the
form of child support or alimony is that you can count this income towards what
you need to qualify for the mortgage. So long as the income is set to continue
for three years then the bank will consider that income stream as part of your
application. However, if you are the one making child support or alimony
payments, the bank will reduce your borrowing ability as this income cannot be
counted towards what you could contribute to your mortgage.
If you were divorced a long time ago you
might not realize that the mortgage company will still want to see your divorce
decree. Though it may seem surprising given the time that has passed, there’s
no statute of limitations on mortgage underwriting and the bank will want to
make sure you are not financially on the hook for anything even decades after a
split.
If you own a house and are still listed
on the mortgage with an ex-spouse you might not think it would be possible to
ever qualify for a new mortgage of your own. Fortunately there’s hope. If your
divorce decree clearly states that your spouse was given the home in the split
and your ex is willing to provide documentation that shows they make the
mortgage payments on the property for the past 12 months, then the new mortgage
company will omit your ownership from your new application, vastly improving
your ability to qualify. Another possibility in cases like this is to explore
the idea of having your ex refinance you off of the loan. This way you’re
totally in the clear in the event that your former spouse stops making
payments.
If you find yourself facing the prospect
of complicated divorce and have questions about your rights and options,
contact an experienced Ohio family law attorney who can help guide you through the
difficult process. Count on the expertise of Twinsburg family law
attorney Carol L. Stephan.
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