Divorce settlement help
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- Posts: 2
- Joined: Mon Oct 18, 2010 11:30 am
Divorce settlement help
I am asking this for a friend who is beside herself. She has recently seperated and her husband has agreed that she can have the family home if she pays out the remaining mortgage. The house is valued at $600K the remaining mortgage is $180K. She has 4 children aged 14 - 7 and receives a mix of child support, family assistance and a part time job income that amounts to $1K per week. She has been refused by the banks as they say she does not have enough income. For the past 8 months her child support has been paid directly into the mortgage instead of to her and she has managed financially. Can anyone help her?
- Otto Dargan
- Mortgage Specialist
- Posts: 7730
- Joined: Sat Sep 06, 2008 5:55 pm
- Location: Sydney, Australia
- Contact:
Re: Divorce settlement help
There are lenders that can accept child support income in their assessment if it meets the following criteria:
Most lender will not accept this income if your children are over the age of 11. However one of our lenders can accept this income no matter how old your children are. Their rationale is that once your children are older then you can return to full time work. They are quite conservative and will only lend up to 70% of the property value, possibly 80% in very strong situations.
The trick for her situation is to apply with the right lender. There is no point applying with every bank only to get declined and end up with a ruined credit score.
- Must be registered with the Child Support Agency (CSA) or be arranged via the court.
- Must be able to show consistent payments for a minimum of six months. If this was paid into the loan account then that should be fine.
- Must be continuing for a minimum of five years. (see below)
- Cannot be the borrowers sole income, they must have a job as well.
Most lender will not accept this income if your children are over the age of 11. However one of our lenders can accept this income no matter how old your children are. Their rationale is that once your children are older then you can return to full time work. They are quite conservative and will only lend up to 70% of the property value, possibly 80% in very strong situations.
The trick for her situation is to apply with the right lender. There is no point applying with every bank only to get declined and end up with a ruined credit score.