After a divorce, you will want to start rebuilding your life. Among your many plans may be the purchase of a home. It is important to start planning early for buying a home after divorce. Some aspects of your divorce may make it more difficult to do so, but there are ways to overcome those obstacles.
Improve Your Credit Score
It’s very common for credit scores to drop during and after your divorce. If you share accounts with your ex-spouse (mortgages, credit cards, etc.), it’s likely that many of those accounts were closed as part of the divorce. Eliminating accounts with good history and available credit limits is known to reduce credit scores. This, in turn, makes it difficult for you to apply for new accounts under just your own name.
It’s important to work on rebuilding your credit history and improving your score. If you have any remaining credit cards or other debts, be sure to always pay them on time. Ask a family member (who has good credit) to add you as an authorized user on some of their credit cards. Reporting of good credit activity will help increase your score over time.
Focus on Saving
You probably have already adjusted your spending habits as a result of becoming a single income household. Remain focused on that and save as much as possible. This will help when it comes time to purchase your next home. A cash reserve demonstrates financial stability and will help with your mortgage approval.
Before starting to look at homes for sale, be sure to contact a local loan officer. Lending rules are constantly changing, so it’s difficult to determine your qualifications for a mortgage without some assistance. Your lender will check your credit, review your income and debt ratios, and evaluate different mortgage programs/options. If you are unable to get approved for a loan on your own, they may suggest having a family member co-sign for you. Knowing what you can afford before you start home shopping is extremely important. Otherwise, you may waste valuable time and experience unnecessary heartache.
Buying a Home After Divorce
Depending on your divorce agreement, you may have some legal questions about buying a home after divorce. In that case, it may be helpful to work with a law firm that practices both real estate and divorce law. Please give Martino Law Group a call. We would be happy to assist you with achieving this next milestone in life after divorce.