When applying for a mortgage, lenders evaluate your income sources to determine your eligibility. Many borrowers don’t realize that alimony and child support payments can be counted as qualifying income, which can help improve debt-to-income (DTI) ratios and increase borrowing power. If you receive these payments and are considering buying a home, here’s what you need to know about using alimony and child support to secure a mortgage.

Can Alimony and Child Support Be Used as Income for a Mortgage?

Yes! Mortgage lenders recognize alimony (spousal support) and child support as valid sources of income, provided they meet specific guidelines. Since lenders must ensure that your income is stable and consistent, they require documentation to verify the reliability of these payments.

Lender Requirements for Using Alimony and Child Support as Income

Each mortgage lender and loan program has specific requirements for counting alimony and child support as qualifying income. Here are the standard criteria:

1. Legal Documentation

To use alimony or child support as income, you must provide legal documentation proving the payments. Acceptable documents typically include:

• A divorce decree
• A separation agreement
• A court order specifying payment amounts and duration
• A legally binding agreement between you and the paying party

2. Payment History

Lenders will require a history of consistent payments to ensure reliability. Generally, you need to show:

• A minimum of 3 Months for FHA loans and 6 months for conventional loans of on-time, documented payments is required
• You may use Bank statements, canceled checks, or direct deposit records as proof. 12 months is required if the payments are voluntary.

3. Future Payment Continuity

Lenders also want assurance that the payments will continue for a sufficient period. Most loan programs require proof that alimony or child support payments will continue for at least three years after the mortgage closing date. So for this we typically ask for a court order and or a divorce decree.

4. Stability of Income

If the payments have been inconsistent or there is a history of late or missed payments, lenders may be hesitant to include them as qualifying income. Demonstrating regular, ongoing payments improves approval chances.

How Alimony and Child Support Impact Mortgage Approval

These payments impact two key mortgage qualification factors:

1. Debt-to-Income Ratio (DTI)

Your DTI ratio measures your total monthly debt obligations compared to your gross monthly income. Since alimony and child support increase your income, they can help lower your DTI ratio, making it easier to qualify for a mortgage.

2. Loan Program Considerations

Different loan programs have varying guidelines for using alimony and child support:

• Conventional Loans (Fannie Mae & Freddie Mac): Require proof of income continuation for three years and a stable payment history.
• FHA Loans: Accept child support and alimony with documented proof and at least three years of future payments.
• VA Loans: Can include alimony and child support, but strict verification is required.
• USDA Loans: Accept these payments with proper documentation and a history of receipt.

Best Practices for Using Alimony and Child Support as Income

If you plan to use alimony or child support to qualify for a mortgage, follow these best practices:

1. Organize Your Documentation – Gather court orders, payment records, and any agreements showing the amount and duration of payments.
2. Demonstrate Consistency – Ensure payments are made on time and maintain records for at least 6-12 months.
3. Work with an Experienced Mortgage Lender – A knowledgeable lender can guide you through the process and ensure you meet all requirements.
4. Improve Other Financial Factors – Maintain good credit, reduce existing debt, and save for a down payment to strengthen your mortgage application.

Final Thoughts

Alimony and child support can be valuable income sources when applying for a mortgage, helping you qualify for better loan terms and increased borrowing power. However, lenders require documented proof, a history of payments, and assurances of future continuity. Working with an experienced mortgage professional can ensure you navigate these requirements successfully.

If you’re considering buying a home and have questions about using alimony or child support as income, North Star Mortgage Network is here to help. Contact us today to explore your mortgage options and start your homeownership journey!