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Effect of Child Support on Mortgage Approval?
I pay 25% of my gross income in Child support through a stipulated agreement enforced by a divorce decree. When applying for a mortgage, will the entire 25% be considered debt? It seems like that wouldn't be fair, given that any family with children certainly pays some significant percentage of their income toward the care of their children, yet in those cases children are not part of the underwriting process. I also see the need for the lender to consider the Child Support expense in some manner, since it is not normally something a person can adjust in a given month if unexpected expenses come up.
Seems to me it would be fair to consider some portion of child support payment obligations as a debt when underwriting mortgages, but not the entire amount.
Does anyone know what the actual practice is?
2 Answers
- golferwhoworksLv 71 decade agoFavorite Answer
it is considered a monthly debt just like a car note. In fact a federal declaration question is are you obligated to pay alimony or child support or a separation payments. So yes it is declared. Now per the divorce decree if it states other than the 25% gross you could use that in answering the question. If it is payroll deducted the underwriter will go off that amount with out fail
I am a mortgage banker in TN & KY
- npkLv 71 decade ago
It isn't considered "debt" but the lender will ignore it as far as income is concerned.
