Child support and how it affects the home loan process – whether paying or receiving child support

See my information below regarding Child Support and the mortgage loan process whether you are receiving child support or paying child support.

 

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Child Support Information

 Receiving Child Support

If you are receiving child support payments from your ex-spouse you may be able to use this money as income to help you qualify for a home loan.  This also applies to alimony or spousal maintenance payments. 

You will need to show you have received the child support payments in full for at least the last six months, and you will need to show that you will continue to receive the child support payment for at least the next 3 years. 

For example, since most child support payments stop with the child turning 18 years of age, if you have a child that is 16 today, you will not be able to count the child support payments as part of your income because the payments will stop in the next two years (remember, you need to show three years of future payments.)

If you have multiple children (say one child is 16 and one child is 10 years of age) and you are receiving child support for both children, you should be able to split the child support amount and count the child support you will receive on the younger child, but not the 16 year old child.

You will need to show a court decree showing the amount of money you are receiving per child.  

Paying Child Support

If you are making child support payments these payments do count towards your debt to income ratio. This means you would need to count the child support payments like you would count any other required monthly payment in the home mortgage loan scenario.

Owing Back Child Support

If you owe back child support and if it shows on your credit report, you will need to pay the back child support before you can qualify for a home loan with most lenders.

Debt to Income Ratios Explained

 

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