However, voluntary payments do not need to be taken into consideration and an exception is allowed for alimony. A copy of the divorce decree, separation agreement, court order, or equivalent documentation confirming the amount of the obligation must be obtained and retained in the loan file. See below for treatment of payments due under a federal income tax installment agreement.

You can only count alimony as income if you have a documented history that your ex-spouse has paid alimony for up to 6 months and owes at least 3 more years of alimony payments. If your lender sees that you receive child support payments but your 17-year-old has a birthday next month, don’t expect your lender to count it as income. If your credit score is high enough for you to qualify for a conventional (non-government) loan, the fact that you are making back-payments for child support won’t disqualify you in itself. You do have to disclose your current support obligation as well as the extra payment when listing your debts on your mortgage application. When it comes to matters of money in a divorce, emotions often run high. If you’re responsible for paying child support each month, it can feel like you’re paying too much.

Taking Care of Back Child Support Without an Agreement

This policy applies whether or not the other party is obligated on the debt, but is not applicable if the other party is an interested party to the subject transaction . Non-mortgage debts include installment loans, student loans, revolving accounts, lease payments, alimony, child support, and separate maintenance. There are some solutions for mortgage loan borrowers who have high monthly child support payments. Many parents who have high child support payments have a family member to cosign for them in order to qualify for a mortgage loan. Asking someone to cosign for them is a major big favor to ask but I have seen a lot of parents of the mortgage loan borrower cosign for them.

These tradelines include credit cards, department store charge cards, and personal lines of credit. Equity lines of credit secured by real estate should be included in the housing expense. If the debts do not belong to the borrower, the lender may provide supporting documentation to validate this, and may exclude the non-applicant debts for the borrower’s DTI ratio. If the debts do belong to the borrower, they must be included as part of the borrower’s recurring monthly debt obligations. Even if your separation documentation clearly states that your spouse is responsible for the payment, you are not off the hook with your current lender. You are an owner and a borrower and until the debt is refinanced/paid in full and you are properly removed, you are responsible for the payment.

Child Support Payments Can Help or Hurt Your VA Home Loan Chances

There are also instances where bills or liabilities come due after the service has been provided such as utility bills, property taxes, and employee salaries. These payments are known as payment in arrears, occur at the end of the period, and are not classified as late. They do, however, fall into arrears if you don’t pay them by the due date. https://simple-accounting.org/ Being in arrears may or may not have a negative connotation depending on how the term is used. In some cases, such as bonds, arrears can refer to payments that are made at the end of a certain period. Similarly, mortgage interest is paid in arrears, meaning each monthly payment covers the principal and interest for the preceding month.

• For example, let’s take a case scenario where a borrower has total monthly debt payments of $1,000.
• Don’t stop making your payments just because you’re ready to buy a home.
• CSS automatically reviews child support orders every three years if the family is receiving public assistance.
• Each recipient is required to obtain an 8 digit key code to access their account.

The Affidavit of Parentage can be signed at your local CSS office, or visit the NC Vital Records website. If a parent lives far from the court, he/she can ask the court to attend the court appearances by telephone. We provide free legal aid to people with civil legal problems in western New York. The information on this website is for general information purposes only. Nothing Qualifying for a Mortgage with Child Support Arrears on this site should be taken as legal advice for any individual case or situation. This information is not intended to create, and receipt or viewing does not constitute, an attorney-client relationship.© 2022 All Rights Reserved. There is no indication that a Notice of Federal Tax Lien has been filed against the borrower in the county in which the subject property is located.