2015 FHA Guideline: Deferred Student Loan Debt Must Now Be Counted.


September 14, 2015 a new FHA guideline, involving deferred student loan debt, will take affect that will affect borrowers when qualifying for a home loan

One of the big changes is how deferred student loan debt is now going to be counted as a monthly debt even though it may be in deferment.  These debts didn’t use to be counted into the debt to income ratio if they were in deferment, however now the lender is to do a calculation to show the loan as a monthly payment, and include it as a debt, which may decrease a home buyers chances of qualifying for a home loan.

This is a huge disadvantage to many individuals who have a mountain of deferred student loan debt.  It is important to note that FNMA and Freddie Mac have not adopted the same rules at this time, but a lender may add their own overlays (their own rules) to the equation and the deferred student loan can be counted as a monthly obligation.  This varies from lender to lender.

Deferred student loan debt may need to be thought of differently in light of these changes.  It may be best to stretch out the debt over the longest period possible to ensure the lowest monthly payment.  When qualifying for a home loan, you want to show the lowest minimum monthly payments as possible to maximize your home buying power.  So college students need to be coached to look for the longest repayment term possible on their student loans to help them in the future when it comes time to qualifying for a home loan.

Best Kevin Walton

Certified Mortgage Advisor, Best Capital Funding

800-506-0632 ext. 0

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