I sometimes have people ask me what the requirements are to count alimony or child support income towards qualifying for a mortgage.
First we need a copy of a divorce decree or separation agreement (if the divorce is not final) that explains all the terms of any alimony and child support, and any other financial arrangements that may have a positive or negative impact on your mortgage application.
In general, we have to review the payment history to determine if it’s been stable income for the borrower. We have to document no less than six months of the borrower’s most recent regular receipt of the full payment.
It is also required that a mortgage lender document that alimony or child support will continue to be paid for at least three years after the date of the mortgage application.
If there have been some missed payments then that income likely won’t be able to be counted. Or if there have been some payments where only partial payment was made, then the income would not be able to be counted. Or if the income is due to stop soon for any reason, and the end date will be less than three years from the mortgage application, then the income would not be able to be counted.
Mortgage guidelines have the ability to change at any time, so always talk to a well-reviewed mortgage loan officer to make sure you understand the current guidelines and how they might apply to you.