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Frequent Contributor
jzsnow
Posts: 421
Registered: ‎08-03-2012
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Has anyone here bought a house with IBR student loans?

Dh and I currently are in student loan repayment under the income based plan. This means we pay 0 a month because of our income and family size. Will this hurt us getting a mortgage? I've read thet might try to use the standard repayment of $1500 a month for our dti! There is no way we would ever hit that payment! Even if our income triples we won't pay that much because of our large family size!

 

any experience out there?

Established Contributor
jadeite788
Posts: 510
Registered: ‎09-25-2009
0

Re: Has anyone here bought a house with IBR student loans?

Why don't you ask the potential lender  you are considering.  Mine is only  considering what I pay monthly only on the IBR.   That is it. 


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Frequent Contributor
jzsnow
Posts: 421
Registered: ‎08-03-2012
0

Re: Has anyone here bought a house with IBR student loans?

I'm going naca I hope, and asking lenders questions is not easy!! They never call or email back!

Valued Contributor
JM-AM
Posts: 3,303
Registered: ‎06-09-2010
0

Re: Has anyone here bought a house with IBR student loans?

Its not a simple question with a yes or no answer...

 

Some Lenders will just consider your payment, while others will not.

Good Luck
May all your dreams and wishes become a reality!
Regular Contributor
JGWantsAHouse
Posts: 132
Registered: ‎03-11-2010
0

Re: Has anyone here bought a house with IBR student loans?

I am in IBR and I purchased my home April 2012. 2 years prior to my app I reached out to some lenders and they seemed pretty uneducated about IBR and all of them basically wanted to treat it as a deferrment and either wanted proof that I was going to pay the $0 for more than 12 months (which is probably near impossible) or use my standard payment which was $950.  I didn't want to deal with the headache so I didn't apply until my income increased and the payment reflected on my credit reports increased to a more believeable payment plan (now its $250).

 

When I applied the lender only confirmed that I was paying $250 per month. She did not ask for any further documentation or payment plan information.  I'm also glad I waited because if I had purchased with $0 payment I probably would have purchased a home with larger payments that would have been more difficult to manage with my increased IBR payment. I know that's not what you want to hear. Been there, done that. But I will tell you that my approval process was very easy compared to some of the other experiences I've read when applicants have $0 payments. 

 

Best of luck to you!

Closed on my first home April 2012

Starting Score: 559 11/2010
Current Score: 600 Equifax, 681 Transunion, 663 Experian(Lender)
Goal Score: 660+


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Frequent Contributor
jzsnow
Posts: 421
Registered: ‎08-03-2012
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Re: Has anyone here bought a house with IBR student loans?

 

thank you! 

 

Because of our family size of 7, even if we tripled our income to 180k (which won't happen!), our payments would only be $300.

 

one lender I talked to said to stop putting money into my husbands 401k because that would bring our agi up to where we would owe $10 on the ibr payment.

 

I know this program isn't new anymore, so I'm hoping that lenders will become more informed since this is a legitimate payment option!

Valued Member
tjeff
Posts: 28
Registered: ‎05-15-2013
0

Re: Has anyone here bought a house with IBR student loans?

Will you PM me the name of your lender? What state are you in? I am currently in underwriting and just found out that the lender asked my loan servicer what my non-IBR payment would be!! I am so scared that they will use the actual loan payment and not the IBR payment. I have my heart set on this home when I first saw it last year. Luckily, no one purchased it and this year, I began the process to purchase it.

Established Contributor
jadeite788
Posts: 510
Registered: ‎09-25-2009
0

Re: Has anyone here bought a house with IBR student loans?


tjeff wrote:

Will you PM me the name of your lender? What state are you in? I am currently in underwriting and just found out that the lender asked my loan servicer what my non-IBR payment would be!! I am so scared that they will use the actual loan payment and not the IBR payment. I have my heart set on this home when I first saw it last year. Luckily, no one purchased it and this year, I began the process to purchase it.


I am on IBR and when I purchased my home last year I was on IBR then.  Why would a lender be asking about what your non-IBR payment would be.  Sounds like they are uneducated about IBR.  Income Based Repayment plan is done yearly, and must be renew yearly and must show proof of income earnings by pay-stub or filing income tax.  After 20 years your loan is forgiven.  If you are on public loan forgiveness program it is forgiven in 10 years.  So if your income doesnt change then your IBR payment does not change either.

 

Plus there is no way you would be able to get proof of non-IBR unless you are not on it.  The loan verification letter needed only shows your current status.  I find it irrevelent to getting the mortgage unless you are in the transition from going to regular payment to IBR.  I do know alot of lenders treat an IBR payment of $0 just like a deferment.  The underwriter should only look at what is shown on your credit report.

 

My lender is Academy Mortgage, and I am in Texas.  They did an excellent job handling my situation.  I actually had to switch lenders when the previous lender tried to pull an okie doke on me. 


Starting Score: 565
Current Experian Score: 634 (Lender pull)
Current Equifax Score: previous 668, 680 as of 11/12/13 lender pull
Current Transunion Score: previous 675,677 as of 09/23/13
Goal Score: 750

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New Contributor
Muschock
Posts: 62
Registered: ‎06-17-2013
0

Re: Has anyone here bought a house with IBR student loans?

In process now of getting a USDA mortage. I am on IBR and my payment is 0$ because I have 5 kids. Because the payment is 0$ they had to include 100$ into my DTI. Had to get something from Sallie Mae with my payment for July 14-June 15 too...I sent tax return and renewal in early and asked them to process early...which they did...after bugging them for a week.
Good luck!!
Valued Member
tjeff
Posts: 28
Registered: ‎05-15-2013
0

Re: Has anyone here bought a house with IBR student loans?

Thank you!  they are using the IBR payment amounts. The loans were not listed on my credit report as open because they were transferred from one loan servicer to another and they had not updated to my credit report.

 

Just an update: I was on a conference call with a 3rd party verification and my student loan lender and the student loan representative gave my IBR payment and non IBR. To make matters worse, I have two loans that are in grace period and the student loan rep used to online calculator and verified that my payments would be $114 when they go into repayment which is totally different that what the mortgage letter stated!!! This ALMOST prevented me from getting the home. I contacted the loan servicer today and asked why their representative would verify my payment would be $114 when I am on IBR and the mortgage letter states something 30 dollars lower. She agreed that the information verified was incorrect. She agreed to particiapate in a conference call and GRACIOUSLY advised the 3rd party verification person that my payment was the lower amount. Verification rep stated she would update this info with loan officer! I hope this means I am in the clear!

 


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