DTI with student loans in repayment?

[midwestgirl44]

I just entered repayment on my student loans - $553 a month until my consolidation is complete. I also just started working 60 miles from home, make a great salary, and we have decided to move closer to my job next summer. We will most likely rent for a few years until we become eligible for the first time home buyer credit again and we become accustomed to the area.

My question is, how are student loans looked upon by a lender? Do they only take into account your monthly payment when figuring your DTI or do they look at the full balance of your loans?

I plan to pay my loans as quickly as possible, but depending on how lenders factor them into a mortgage approval may change our game plan - we would shift more $ to pay them off than we anticipated, but this would equal less in savings for a down payment.

Any advice and/or insight would be appreciated!

[ShanetheMortgageMan]

The payments on the student loans are factored into your debt ratio, not the balances.  Whatever is reported on the credit report is what will be used, unless you have something in writing stating the payment is less.  If no payment is reported on credit (I've seen student loans that still say "deferred" even when payments have been going on for months), then actual statements would be needed.

I haven't heard of anything about the federal first time home buyer credit coming around again, but who knows what'll happen in years down the road.  Some individual states may be offering their own first time home buyer credit as well.

[midwestgirl44]

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@ShanetheMortgageMan wrote:

The payments on the student loans are factored into your debt ratio, not the balances.  Whatever is reported on the credit report is what will be used, unless you have something in writing stating the payment is less.  If no payment is reported on credit (I've seen student loans that still say "deferred" even when payments have been going on for months), then actual statements would be needed.

I haven't heard of anything about the federal first time home buyer credit coming around again, but who knows what'll happen in years down the road.  Some individual states may be offering their own first time home buyer credit as well.

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Oops, sorry about that. I mistakenly referenced the first time home buyer credit when I meant that we would become eligible for more mortgage products as we would be viewed as first time home buyers by lenders. Sorry for the confusion, but thank you for the information!