Achieve Stability for Your Family: The Single Parent's Guide to Mortgages
With the right knowledge and preparation, a single-parent mortgage can be secured, provided they get these insights tailored for single parents.
Like it or not, securing a mortgage as a single parent presents unique challenges.
Balancing the responsibilities of raising a child on a single income presents many challenges, not least the difficulty of saving for a house purchase.
If you’re in this situation, understanding the special obstacles you might face will go a long way to smoothing your journey.
With the proper knowledge and preparation, single parents can successfully secure a mortgage, provided they get some practical advice and insights tailored for single parents.
In this article, we’ll help you learn how to overcome common obstacles and achieve your goal of securing a single-parent mortgage.
Start your application with MIDFLORIDA Credit Union.
Can I get a mortgage as a single parent?
Yes—single parents can obtain a mortgage.
The good news is that the overall eligibility criteria remain the same as those for other borrowers. However, single parents often worry about whether their financial situation will meet lenders' requirements.
Common concerns include:
- The inherent limits of a single income
- A lower credit score that is often paired with a single income-earner
- The higher debt-to-income ratios that frequently follow the above factors
However, thousands of single parents have secured mortgages by demonstrating the right financial responsibility and stability.
Qualifying for a mortgage as a single-parent
The big three factors that can increase your chances of securing a mortgage include:
- A stable income
- A good credit score
- A manageable debt-to-income ratio
Regardless of your family situation, lenders are always looking for a steady employment history and reliable income sources, which can include child support and alimony.
These income streams must be documented via a legal agreement or divorce decree to accurately calculate and ensure the payments are consistent and ongoing.
How often do single parents get a mortgage?
Statistics show that single parents are actively participating in the housing market.
Single women accounted for 18% of homebuyers in 2021, with single men making up 9%. These stats highlight that single parents can and do achieve homeownership—and with the proper preparation and support, you can join their ranks.
Tips for improving your mortgage application as a single-parent
Securing a mortgage as a single parent can be challenging. Still, there are several strategies to discover the best time to buy, enhance your application, and improve your chances of approval.
Improve your credit score
Credit scores are a critical factor in mortgage approval for any borrower.
- Pay down existing debts to reduce your debt-to-income ratio.
- Ensure all bills are paid on time, and resolve any disputes on your credit report.
- Regularly review your credit report for possible inaccuracies and address them immediately.
Save for a larger down payment
A larger down payment will automatically reduce your loan-to-value ratio, making you a more attractive candidate to lenders.
Though not required with many mortgage products, saving 20% of the home’s purchase price is still advisable.
This improves your approval odds and can help you avoid the annoying extra cost of private mortgage insurance (PMI).
Gather necessary documentation
Compile all the required documents, including:
- Proof of income
- Assets
- Tax returns
- Bank statements
- Divorce Decree/ Child Support Agreement (if applicable)
If you receive child support or alimony, ensure these payments are well-documented and consistent. Lenders want to see a clear picture of your financial stability.
Maintain stable employment
A stable employment history can make a big difference. Lenders tend to prefer applicants who have been with their current employer for at least two years.
If you’ve recently changed jobs, be prepared to explain the reason for the change and how it benefits your career.
Create a realistic budget
Creating a budget that tracks your income and expenses is key to securing a loan. It demonstrates financial responsibility to lenders.
Breaking down your budget details helps you determine how much you can afford to borrow.
It shows lenders that you are more financially responsible than the average borrower—factor in all potential costs of homeownership, including maintenance, insurance, and property taxes.
What do I need to know as a divorced parent getting a mortgage?
A “single parent” does not always mean a “divorced parent,” but is a common pairing.
However, being divorced can complicate your financial picture when applying for a mortgage, especially regarding income and credit status.
Tips to improve your chances of approval
Start by gathering all the relevant financial documents that provide lenders with a clear picture of your financial obligations and income sources, including:
- Your divorce decree or separation agreement (if the divorce is not final)
- Child support agreements
- Alimony arrangements
Changes in income post-divorce can impact your mortgage application as lenders will scrutinize your income stability and may require proof of consistent child support or alimony payments
Ensure these payments are well-documented and, if possible, deposited directly into your bank account to create a clear record
Note: some lenders may require proof that these payments will continue for a specified period, typically at least three years.
Credit snapshot: Tips for improvement after divorce
Divorce can sometimes lead to financial strain, thereby affecting your credit score.
Like other single parents, you can improve your creditworthiness by paying down and avoiding new debts. Check your credit report regularly for any inaccuracies and promptly address discrepancies.
By understanding these challenges and taking proactive steps, divorced parents can strengthen their mortgage applications and improve their chances of securing the right mortgage for their home.
The right lending solutions for single parents with MIDFLORIDA
Securing a mortgage as a single parent is achievable—particularly with the right preparation and support.
By improving your credit score, saving for a larger down payment, and gathering the necessary documentation, you can strengthen your mortgage application.
Understanding the various mortgage options and working with an experienced lender are key steps in this journey.
With the right approach, single parents can overcome challenges and achieve their dream of homeownership.
MIDFLORIDA can connect you with the right mortgage solution
Homeownership is one of the best ways to secure a more stable environment for your family and improve your financial future. And being a single parent shouldn’t limit your ability to buy your home.
Start your application with MIDFLORIDA to discover your homebuying options.
Get started on securing your family’s future.
MIDFLORIDA Credit Union does not discriminate based on race, color, national origin, religion, sex, marital status, age, the fact that all or part of the applicant's income is derived from any public assistance program, the fact that an applicant has exercised rights, familial status, and disability.
This blog is for educational purposes only, not an offer of credit or advertisement for current loan terms. It does not provide legal advice. Refer to our loan web pages or consult professional advisors for specific information.
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