Does Spousal Support or Child Support Count as Income for a Mortgage?

Yes, in most cases it does. Spousal support and child support can be counted as income when you qualify for a mortgage, and for many people keeping the house or buying their next one, it's what makes the numbers work. But lenders have specific rules, and how your judgment is written matters a lot.

The basic rules for conventional loans

Under Fannie Mae's guidelines, which most conventional loans follow, a lender generally needs three things:

• A written agreement or court order showing the amount and terms, like your divorce decree, separation agreement or support order
• Six months of receipt, showing full, regular and on time payments, usually through bank statements
• Three years of continuance from the date you apply, meaning the support is expected to keep going at least that long

FHA, VA and other programs have similar rules with some differences in how much receipt history they need, so it's worth checking the program before you count on the income.

What doesn't count

Voluntary or informal payments. If you're separated and your spouse is helping out without a written agreement, a lender generally can't use it.

Lump sum equalization payments. A one time payment to even out the property split isn't steady income. It can be a great down payment, though.

Support ending soon. If child support stops when your youngest turns 18 in two years, it won't meet the three year test.

The three year rule trips people up

Look closely at end dates. Spousal support set to step down or end in 30 months won't count. Child support for a 16 year old usually won't either. If you're negotiating, the duration language can decide whether you qualify. That's a conversation to have with your attorney before you sign.

What if I just started receiving support?

If you haven't received six months yet, you may need to wait, or qualify on other income first. One option is to plan the timing: finalize the support order, document six months of deposits, then close. Another is to use support for a program with shorter history requirements. I can tell you which applies to you.

Paying support affects you too

If you're the one paying, lenders count that payment as a monthly obligation. Some programs let it be subtracted from income instead of added to debts, which can help your ratios a bit. Either way, it has to be disclosed.

A tip on documentation

Have support paid by direct deposit or check into one account, not cash or a payment app mixed with other transfers. Clean deposits that match the court order make underwriting easy.

Sources: Fannie Mae Selling Guide B3-3.4-02. General information, not legal or tax advice.