PURCHASING A NEW HOME
A new home could be in your future after a divorce and there are 3 major areas to consider. They are Income, Assets and Credit.
Your source of income has changed if you were a two-income family. You probably will have to qualify for a lower loan amount unless you are buying with a cosigner or a new significant other. If you are to receive child support and/or alimony and can document these payments will continue these can be factored into income to qualify for a loan. If you are paying spousal or child support and you can document they will be ending soon these payments could be excluded and this would help you qualify to borrow more. These scenarios effect your DTI (debt-to-income ratio). DTI is used to measure what percentage of your monthly income is used to pay of debts like mortgage loans, auto and credit card payments.
Assets are needed to purchase a home. The total assets will be the down payment, closing costs, and escrow funds.
Your credit score is important in qualifying for a loan to purchase a new home. If your credit score is better than your ex-spouse this will be a benefit to you. If you need to establish credit speak to one of our Divorce Lending Specialist to guide you.
Getting your Income, Assets and Credit in order is the first step to a fresh start in a new home.