Separation Agreements For Mortgage Qualifications

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New Home Dream Into Reality: Separation Agreements

In today’s world, mortgage and lender qualifications often become more complicated with a “separated” martial or relationship status. Banks often ask to see a mortgage qualification separation agreement before approving you for a mortgage. It is likely that a bank will require a mortgage qualification separation agreement in certain situations. Most often, they want one if you are married but separated from your spouse and you are either:

  • buying your spouse out of the matrimonial home or
  • purchasing a new home.

The lawyers at Kahane Law office in Calgary, Alberta are able to help draft your mortgage qualification separation agreement quickly and economically.

Why Banks Want To See A Mortgage Qualification Separation Agreement?

Mortgage qualification separation agreements establish better financial certainty after separation. Your lender will most likely want to know what child or spousal support obligations you have as well as assessing the property and debts you will be taking on. If you hope to claim support payments you receive as part of your mortgage application, then a mortgage qualification separation agreement can help. This will give the bank a better picture of your financial situation and help them determine whether you qualify for a new mortgage. Although you may have a verbal agreement with your spouse, these relationship contracts gives the bank the assurance that it is a binding agreement.

What We Include In These Agreements?

Generally, separation agreements for mortgage qualification will normally set out the property that each person will keep and the debts that each party will be responsible for. If you have children together it will likely also deal with custody, access and support arrangements for your children. Additionally, spousal support is commonly addressed, whether there is an obligation for one party to pay support or not. Mortgage qualification separation agreements are still binding agreements. If you decide to proceed with a divorce, the terms of the separation agreement will often form part of the divorce order.

Why You Need Lawyers In This Process

Many people just sign off on any agreement when one party is trying to qualify for a mortgage. The may, at the request of a source or third party, sign off on what they think is just a mortgage formality. BE CAREFUL: People often waive very important rights with these types of agreements and it is essential that a lawyer inform you of the consequences of signing any legally binding documents. Never assume that anything you sign is “just for” or “is only used for” a mortgage qualification. The consequences of not having legal advice can last for many years or lead to expensive and expensive matrimonial litigation.

When To Look Into A Separation Agreement?

If you and your spouse are in agreement about how you will divide property and debts, spousal support and child custody and support (if applicable) then going ahead with a mortgage application separation agreement is a good starting point. Learn more about regular separation agreements that can be prepared by our lawyers. With a separation agreement in place have several benefits. For example, these include the following:

  • Access to equity from your matrimonial home;
  • Facilitating your lender’s ability to quickly determine your mortgage qualification; and lastly
  • Assisting to see if you need a co-signer or if you qualify for the new mortgage on your own.

You want to consider the preparation and execution of these agreement ahead of time. This ensures that you have the time you need for properly completing a mortgage application separation agreement. Although we can usually prepare these types of agreements quickly, it is a process and there is no guarantee as to whether your spouse will sign and, if they do, how quickly they will sign mortgage qualification separation agreement. DO NOT SIGN any contract to purchase a house until three things happen. Firstly, all the lenders conditions have been met. Secondly, you have a signed mortgage qualification separation agreements. Lastly, your family law lawyer indicates it is safe to do so.

Why use Kahane Law Office?

Kahane Law Office has lawyers that specialize in real estate law as well as family law. This means that the same lawyer can assist you throughout the process and provide a more seamless service. Both services will have flat rate fees so you will be better able to make an early informed decision. To schedule a appointment with one of our mortgage qualification separation agreement lawyers to discuss your entitlements, obligations and drafting an agreement, please contact our experienced team at Kahane Law Office. Connect today. You can reach us toll-free at 1-877-225-8817, 403-225-8810 locally in Calgary, Alberta or email us directly here.