One of the biggest challenges that a spouse can face is refinancing a property that he or she has been awarded in a divorce settlement.  While the key to successful refinances is to have a strong credit score. A good credit score will help you get approved for a loan and get a lower interest rate. You can improve your credit score by paying your bills on time, maintaining a good credit history, and using a credit monitoring service.

If you are divorcing and need to refinance your home, this means that you are qualifying for a mortgage. In many cases, the spouse attempting to qualify for that mortgage was not educated on the amount of income that would be necessary in order to qualify for that future refinance. This often leads to situations where the spouse is required to refinance but simply does not qualify.

This is where an upfront consultation with a mortgage broker can help. First, the mortgage broker can advise you of the target income needed to refinance the mortgage at that later date.  

In addition, the mortgage broker can advise you on how much alimony, child support, and other income you may be receiving can be used for your qualification. In some cases, the mortgage broker will advise you to have settlement assets placed into a trust so those assets can be distributed out to you over a period of time at a consistent amount.

This trust concept can be used as income if the lender can demonstrate it will continue for 36 months after the refinance. This is just one example of a strategy a mortgage broker can bring to your client at the time of settlement.

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