Disclosure Before Asking About Alimony or Child Support Income

Applicants may receive support payments, but they may not want the creditor to consider those payments. Regulation B protects that choice. The disclosure is especially easy to miss when an application asks generally for income sources and could lead an applicant to identify alimony, child support, or separate maintenance.

The rule under § 1002.5(d)(2)

A creditor must not inquire whether income stated in an application comes from alimony, child support, or separate maintenance unless it tells the applicant that the income need not be revealed if the applicant does not want the creditor to consider it in determining creditworthiness. The disclosure should come before or with the relevant inquiry so the applicant can make an informed choice.

General versus specific questions

A general question such as “List all sources of income” may prompt an applicant to disclose support income, so the application should include the optional-disclosure statement. A narrowly worded request for salary, wages, or investment income is unlikely to prompt the protected disclosure; the official interpretation says the special statement is not needed for a specific inquiry unlikely to elicit it. The distinction turns on how the question is worded, not merely on whether the creditor uses a paper or online application.

The applicant may choose to include the income

The rule does not force a creditor to ignore alimony, child support, or separate maintenance when an applicant voluntarily wants it considered. Instead, it prevents the creditor from requiring the applicant to reveal that source. If the applicant chooses to rely on it, the creditor may evaluate the information under applicable credit standards and should apply those standards consistently.

Application design examples

• Broad prompt: “Other income” should be paired with a clear statement that support income need not be disclosed if the applicant does not want it considered.
• Specific prompt: asking for salary or wages only generally does not need the support-income disclosure because it is unlikely to elicit that information.
• Avoid wording that implies support income is mandatory or that an applicant must explain why they choose not to report it.
• Ensure online forms display the notice with the question, not behind a link the applicant may never see.

Exam takeaway

Before a general income-source inquiry that may reveal alimony, child support, or separate maintenance, disclose that the applicant may omit it if they do not want it considered. A narrowly specific salary or wage question is treated differently.

The applicant chooses whether support income is considered

Regulation B generally permits a creditor to inquire about alimony, child support, or separate-maintenance income. But if an applicant does not want that income considered in a credit decision, the creditor may not ask about it. Do not presume that a person receiving support must disclose it or pressure the applicant to include it.

Present the choice neutrally. If the applicant elects to rely on support, the creditor may request information reasonably needed to evaluate and verify it under consistent standards. Permission to inquire does not require the lender to count every disclosed payment; normal underwriting still applies.

Apply consistent verification standards

A court order or written agreement may help explain an obligation or payment stream, but does not alone establish the amount received or its continuance. An informal arrangement may also exist. Apply the creditor’s stated income verification criteria rather than inventing a stricter test because the funds come from support.

Keep incoming support income distinct from outgoing support obligations that may affect repayment. Do not net them informally or omit material obligations from underwriting. Avoid unnecessary questions about marital status, custody, or family circumstances when they are not needed for a permitted credit purpose.

Common exam traps

The rule does not say creditors may never ask about support income. The rule is conditional: inquiry is allowed when the applicant wants the income considered and prohibited when the applicant does not. A lender may verify disclosed income and decide whether it meets consistent underwriting standards.

If an applicant says they do not want support considered, do not insist on an amount or demand an order merely because the application reveals children. If the applicant includes it, document the election and follow ordinary verification procedures without steering or differential treatment.

Practical review points

The choice should be genuine and recorded in a way that does not pressure the applicant. A neutral application can ask whether the applicant wants the specified support income considered, then request verification only when the answer is yes. Keep the response confidential and avoid inferring family details from names or household composition. If a creditor’s system automatically imports support information, the workflow should still honor the applicant’s choice not to have it considered.

Additional application detail

If the applicant changes their decision about whether to include support income before the credit decision, follow the creditor’s process for updating the application and verification. Do not retain or use information the applicant chose not to have considered as an informal underwriting factor. Staff should not make assumptions about reliability based on gender, marital status, or family structure.

Final review scenario

A creditor may not avoid the applicant-choice protection by obtaining the information indirectly or making it a mandatory field regardless of the applicant’s preference. Design forms and scripts so the applicant can decline consideration without an adverse implication. If support is included, distinguish the applicant’s statement from verified evidence and use the same standards for comparable income sources.

Additional boundary example

Example: an applicant checks that they do not want monthly support payments considered. The creditor should not require the amount or a copy of the support order just because the application reveals that the applicant has children. If the applicant later elects to rely on that income, the lender may request reasonable verification and evaluate its amount and continuance under its ordinary standards. Do not infer a support obligation from marital status, custody, gender, or household composition, and do not use information the applicant chose to exclude as an informal underwriting factor.