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Getting a mortgage or refinance after divorce

New Jersey residents who are getting a divorce might want to keep the family home or may want to buy a new one. However, after a divorce, their income and credit rating may be lower. This can create problems in refinancing the home or getting a mortgage from a lender. People who are unable to meet lenders' requirements might need someone to cosign in these circumstances.

Some forms of income that they might have after divorce may not be factored in immediately by lenders. For example, it may be necessary to get alimony for several months before it can be included as income. They may need to have two years of tax returns showing income from part-time jobs, commission-based jobs or bonuses for any of these income sources to be included in calculations.

People who want to keep the family home should make sure the decision is not driven largely by emotion. There are a number of financial considerations to keep in mind. For example, a person's income, whether the person is paying alimony and child support, the appraised value of the home and more should all be taken into account.

The couple might be able to negotiate an agreement regarding property division as an alternative to going through litigation. One advantage of this approach is that it gives the couple more control over the process. If the couple is unhappy with a judge's decision about property division, there may be little they can do to change it. Negotiation may also allow for more creativity and flexibility. For example, if there are children, the couple might decide to keep the home for a year or two. The children can remain in the home as they adjust to the divorce while the parents take turns living there.

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