How does a client buy a home after a divorce?

Buying a home after divorce usually means qualifying on one income, with a brand-new decree, and a credit report that may still show the old joint mortgage. None of that is a deal-killer. But it changes what you ask, what paperwork you collect, and when you write the offer. Here's how I coach agents to set these buyers up so the loan actually closes.

The short answer

Colorado has no legal waiting period to buy after a divorce. The lender's rules set the timeline. Lenders can count maintenance (Colorado's word for alimony) and child support the buyer receives, if a court order requires it, there's a payment history (often six months), and it continues for a set time after closing (often three years). Support the buyer pays counts as a debt. The old mortgage counts against them unless the decree assigns it to the ex and the lender accepts that, or the ex has a documented payment record. Most buyers wait for the final decree before closing.

Step by step

Ask where they are in the case. Filed? Temporary orders? Final decree? Buying during a pending divorce is tricky. The automatic order after filing limits taking on debt tied to marital property. Their attorney should sign off before any offer.
Get the decree (or the draft) to a lender early. A lender who reads the draft can flag problems while it can still change. After the judge signs, only a court can change it.
Check support income against the rules. Three things: Is it court-ordered? Is there a payment history, often six months of deposits? Does it run long enough after closing, often three years? Child support that ends when the youngest child ages out within that window may not count.
Count support they pay. It's a monthly debt in the debt-to-income ratio, just like a car loan.
Deal with the old mortgage. If the buyer is still on the loan for a house the ex kept, that payment counts against them by default. The decree assigning the loan to the ex can let the lender leave it out. Without that, many lenders want about 12 months of on-time payments made by the ex from the ex's own account.
Check credit for lates. One recent 30-day late on the joint loan can hurt the score and the approval. Have the buyer pull reports and watch the old loan monthly until their name is off it.
Line up down payment help. One-income buyers often qualify as first-time buyers again under some programs if they haven't owned in a set number of years. See down payment assistance basics.
Qualify before you show homes. Use the same screen you'd use for anyone. See how to qualify a buyer before the lender.

A worked example (illustration only)

A buyer earns $6,000 a month gross. Target housing payment: $2,200. Car and card payments: $400. Lender's example limit: 45%.

	Wages only	Wages + $1,200 maintenance received	Wages, old $1,800 mortgage still counted
Gross monthly income	$6,000	$7,200	$6,000
Housing + other debts	$2,600	$2,600	$4,400
Debt-to-income ratio	43%	36%	73%

Same buyer, same house, three very different answers. The decree wording and the payment history decide which column the lender uses.

Illustration only. A lender sets the real terms and the real debt-to-income limit. This example shows ratios only and leaves out rates, mortgage insurance and closing costs. The annual percentage rate (APR) would differ from any note rate. This is not an offer of credit. Program rules change. Check current rules in the Fannie Mae Selling Guide, HUD Handbook 4000.1 and with a licensed loan officer.

Timing: when can they close?

Right after the decree: Possible if their income stands on its own and the decree handles the old loan in a way the lender accepts.
After about six months: If they need support income to qualify and the payments started at the decree.
After about 12 months: If the decree is silent on the old loan and the lender needs a year of payments by the ex.

Support that started under temporary orders may already have a history. Every lender has its own overlays, so have the loan officer map the dates. Court forms and self-help are on the Colorado Judicial Branch site. The CFPB has plain-language mortgage and credit guides.

How to explain it to your client

Say it like this

"There's no legal waiting period to buy after a divorce. The lender just needs to see three things: your income on its own, how your decree handles any support, and what's happening with the old mortgage. If you're getting support, the lender usually wants a few months of deposits and proof it keeps going for a while. If you're still on the old loan, your decree's wording matters a lot. Let's get your decree, or the draft, in front of a loan officer now. Then we'll know exactly when you can buy and at what price."

Watch-outs

Don't skip the attorney during a pending case. New debt during a divorce can collide with court orders.
Short support doesn't count. If it ends soon after closing, the lender may leave it out.
Cash or handshake support doesn't count. No order, no paper trail, no credit.
Lump-sum equalization payments aren't income. They may help with the down payment, though.
Ex pays late, buyer pays the price. Late payments on a joint loan hit both credit reports.
No new credit. No new cards or car loans until closing.
Don't promise approval. You can explain the rules. The lender decides.

Questions

Is there a waiting period to buy after a Colorado divorce?

Not in state law. The lender's rules and the decree set the timeline.

Does alimony count as income for a mortgage?

Often, yes, if it's court-ordered, has a payment history and continues long enough after closing. The lender confirms.

Does child support count?

It can, under similar rules. If it ends soon after closing, it may not.

My client is still on the old mortgage. Can they buy?

Possibly. If the decree assigns the loan to the ex and the lender accepts it, the payment may be left out of their ratio.

Does the buyer have to list support on the application?

They choose whether to rely on it. If they leave it off, the lender can't count it.

Brian Lee Burke is the founder of PadLeaders, a Colorado real estate broker licensed since 2003, team leader of The Kenna Group at Keller Williams DTC (formerly Kenna Real Estate Group) and the author of Mastering Real Estate and The Real Estate Playbook. More about Brian.

Sources

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