Many Florida residents emerge from a divorce with an enormous sense of energy and enthusiasm about rebuilding their lives to suit their personal needs and aspirations. For some, a large step along the path toward independence is purchasing a home of their own. Even in times of economic uncertainty, buying a home remains one of the wisest financial moves that an individual can make. However, some would-be homeowners find that lingering divorce issues can have an adverse effect on their ability to finance a new home purchase.
Each scenario is unique, and no two borrowers come to the lending table with the same mix of assets and liabilities. It is imperative to begin the house hunting process by sitting down with a trusted mortgage broker and going over the details of one's divorce decree. The contents of this document can have a significant impact on what type of loan product is the best fit for one's needs.
One issue that can cause difficulty in securing a new loan involves cases in which the divorce decree awards the family home to one party, but both former spouses remain on the mortgage. The new lender will need to see proof that one's former spouse is making the payments on the mortgage. This usually requires bank statements or cancelled checks dating back for 12 months or more. In cases in which a divorced couple maintains a shared bank account, proving that one spouse is responsible for the mortgage is difficult, if not impossible, and can harm one's ability to find a new home loan.
These are just a few of the financial ramifications that can result from the provisions outlined within a divorce decree. Just as no two marriages are alike, each divorce is also unique. For Florida homeowners who wish to move forward with the purchase of a new home, reviewing the divorce issues within this important document is the first step toward that goal.
Source: Fox Business, "Is Divorce Keeping You From Buying a Home?" Scott Sheldon, June 21, 2013