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Is a Mortgage Right For You Following Divorce?

Getting a mortgage following a divorce can be difficult since you are in a very different financial situation than before. But when your former spouse gets to remain in the family home following the divorce settlement, you will have no choice but to find a new place to live. Unfortunately, this may be a little more difficult than it seems since your move from a two-income household to a one-income household and the payment of child support and alimony can indicate that you need time to develop your financial strategy.

A Mortgage Should Not Be Taken Lightly

Creditors will seek to give their services to someone with consistent income and a good habit of paying back their loans. Immediately following a divorce, there is little evidence of how your new status will affect your finances, making lenders unsure whether or not you can repay any debt.

There are some things that can make it easier to obtain a mortgage, such as:

  • Removing your name from the mortgage on the home you co-own with your former spouse
  • Keeping your name on a mortgage so children can remain in their family home
  • Waiting until the divorce proceedings are finalized before applying for a mortgage

The biggest concern for lenders is that any money paid out as a result of the divorce settlement will be new debt that the person must learn to live with before they can know how it affects their regular finances. Further, even if you are the one that is receiving alimony, lenders will want to see a regular and consistent payment over a few months to ensure that this is actually positive income.

In the midst of many big life changes, sometimes the best thing to do is realize that a mortgage is an additional expense you may need to live without until you get more settled as a single person. Many will try to obtain a mortgage without understanding what they are getting into only because it seems like the right thing to do in a divorce.

Consulting with a divorce attorney can help you determine if a mortgage is the best option for you following a divorce. Cutter & Lax is here to help for any questions about your San Bernardino divorce, including how you can make the best financial moves from this point forward.

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