Line 31a of the 1040 tax return is where alimony/family support is listed. Waukesha State Bank will allow the amount listed there to be deducted from income as opposed to treated as a debt.
Why is it important? Calculating income in this fashion can be the difference between a $117,000 or loan vs a $300,000 loan. Realistic assumptions are below.
- Example: $100,000 / year income, and pays 25% family support, auto loan of $300/month, $150 credit card bill and the property taxes are $4,800 per year. Using conventional guidelines the borrower qualifies for a $117,000 loan.
- Using me as your Loan Officer, and deducting the family support/ alimony from income allows a loan amount just over $300,000.
From the fanniemae underwriting manual:
Alimony/Child Support/Separate Maintenance Payments
When the borrower is required to pay alimony, child support, or maintenance payments the payments must beconsidered as part of the borrower’s recurring monthly debt obligations.
Charlie Johnson
Waukesha State Bank
262-853-6256 cell
NMLS ID 284244
Celebrating 72 years
as your local
No comments:
Post a Comment