How can I ensure I can afford the mortgage alone after divorce?

| Dec 4, 2020 | Firm News |

Marriage provides an opportunity for pooling resources. Doing so makes it much easier to qualify for economic opportunities you may not have qualified for alone, especially in your younger years. For instance, you may have purchased a home with your ex in your 20s. Now that you plan to divorce, you may decide to keep the home. 

If you continued to work during your marriage, meeting underwriting guidelines for a mortgage may prove easy. If you stopped working, you may have a more difficult time qualifying for a mortgage. 

Determine feasibility

You may feel a sentimental attachment to the home, but is it really financially feasible? Do you really need a home that big as a future bachelorette or bachelor? Would downsizing make more sense? Even if you cannot qualify for the current mortgage, you may qualify for a smaller one. 

Get a Job

Virtually no mortgage company will approve you for a loan unless you have a steady income or enough assets at the ready to pay off the mortgage. You may need to work for at least a year to qualify as an employee and at least two years to qualify on self-employed income. 

Build your credit

Thankfully, building your credit is not nearly as difficult as you might think. As long as you have no derogatory comments, you may secure a 600 or better score in six months or so. NerdWallet recommends the following: 

  • Get a credit card in your name, even if you can only get a secured credit card. 
  • Ask a trusted family member or friend with a high score to add you as an authorized user on one of their accounts. 
  • Get a credit builder loan from a local credit union. 
  • Use Experian Boost to get credit for your current bill payments. 
  • Use your credit responsibly. 

If all else fails and you simply cannot qualify for the home on your own, you may work something out with your ex to pay the mortgage without refinancing. You may also ask another family member to refinance with you as a joint owner.