Divorced and Need a Mortgage

 In Qualifying for a Mortgage, Refinancing your Mortgage

About half of the marriages in the United States end in divorce. Many people who are divorced (or separated) apply for mortgages. Here’s what you need to know if you are divorced and need a mortgage.

Marital Status

When a lender completes a loan application, they are required to ask about your marital status. You’ll need to establish if you are married, unmarried (includes single, divorced, and widowed), or separated.  

Child Support

If you are divorced and are paying child support, alimony, or maintenance, then a lender will need documentation showing the terms of the divorce agreement.

If you are divorced and are receiving child support, alimony, or maintenance, and you intend to use that income to qualify for the mortgage, then a lender will also need additional documentation.

Necessary Documentation

Here’s what you will need to provide if you are divorced and need a mortgage:

  • The recorded divorce decree.  It must be recorded (stamped by the county clerk). Otherwise it is not official.
  • The separation agreement.  This spells out the terms of the separation and eventual divorce.  It states which party is responsible for paying various liabilities and also shows how assets are being divided.
  • Any attachments referenced in the separation agreement or divorce decree.  This includes child support orders, and alimony and maintenance agreements.
  • If you are separated, but not divorced, you will need to provide the recorded separation agreement and any documents referenced in the agreement (child support, alimony, maintenance, etc.).

The lender needs to see these papers, not because they are nosy, but because they need to calculate your assets and liabilities correctly. Lenders see the paperwork for many divorces and separations, and are just looking at them to make sure you are qualified for the mortgage.

It is important to note that it is illegal for a lender to discriminate against a borrower based on marital status.  However, lenders are required to gather all the information necessary to determine if a borrower can repay the loan.

If you have any other questions, feel free to contact us.

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