Rental house


#1

I need to get this clear. Thanks. This week we are going back to recalulate child support because my ex is now on Disability. He has a rental house but when I asked to see income he listed the income and then all his expenses and showed a loss of $150 per month, so says there is no income to report and is trying to sell because it is draining him.
I disagree, He bought the house for himself to live in when we separated in 2003, for $169,00 with a mortgage of $134,00. Records show that between purchase date of 2003 and 2007 this house built over $100.000 in equity and in 2007 was valued at $270,00. He married in 2005 and when he did he paid off one loan to take a larger loan in both his and his wife’s name ( deed stayed in his name) again a year later she took an additional 30,000 loan against this property with his co-signed name. These loans were taken against that equity . Am I right to say to the Judge that without proof of major home additions or renovations/repairs one can assume these loans of additional $67,450.00 were used for paying off credit cards, vacations and or any other expenses that were not related to this house at all. The monthly rental covers these expenses and thus the part of this rental income that covers these additional loans is income and should be reported as such.
Also I would like to know - if he does sell this house and makes a profit does that need to be reported to child support?


#2

You may certainly argue that these loans were essentially used as debt consolidation, and you can ask for the records relating to the loans and what they are for, however if he is renting the home at a loss, it will not matter, as child support is based on the incomes of the parties, not their debts.