Question about getting a mortgage with student loans

[Anonymous]

Been a reader for a bit now, thanks for all the information.

I am in the process of looking for homes, but haven't started the pre-approval process yet. I am curious if you guys think I can get approved.

My yearly income is $55,000, i have a fico in the 760s, and no blemishes on my credit. However, I do have student loans of upwards of 70k in total. 

The only bills I have now is my student loan which equals 480/month.

The houses I am looking at are in the 130k range. I have $15,000 saved for down payment/closing.

The only thing that kinda worries me are my student loans. Will this have an effect on getting a mortgage?

Thank you. 

[teton]

Your student loans would be figured into your debt to income ratio like any other debt. The mortgage experts can give you better feedback than I can on how much house you can afford. There are calculators out there that will give you an estimate, though.

[Anonymous]

Thank you for the insight, right now, my debt to income with no mortgage is 10%.

From what I've read, lenders would like a DTI ratio of around 35 with a mortgage.

Is this correct?

[DallasLoanGuy]

i am seeing up to 55% dti approved thru automated underwriting.

files with higher dti dont always get approved unless they are strong in other areas, like fico or cash reserves.

[Anonymous]

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@DallasLoanGuy wrote:

i am seeing up to 55% dti approved thru automated underwriting.

files with higher dti dont always get approved unless they are strong in other areas, like fico or cash reserves.

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Thanks for the insight DallasLoanGuy. It looks like my DTI might be approved through automated underwriting.

I have a few careless NSF on my checking account, so I am waiting a few months before I start the pre-approval process.

Judging by the information I have posted, do you guys think I am a good candidate for automatic underwriting for an FHA or even conventional loan?

recap:

$55,000 yearly income

$480/mo student loan payment

$0 car/cc payments

767 middle FICO

saved about 10-12% down

no blemishes on credit report

have a few NSF from trying to put more money in savings than i should have, but am waiting a few months so if/when UW asks for 2-3 months of bank statements, i should be okay.

Message Edited by emiller on 10-13-2008 07:07 PM

[BrianB_The_Loan_Professor]

You should be fine

You could also get past the NSF's with a verif. of deposit. Not all lenders are taking them but most are.

I think you will get the automated approval but even if you dont your debt to income can be a combine 43% so you would still qualify if it had to go manual UW.

Good Luck

Brian

[Anonymous]

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@BrianB_The_Loan_Professor wrote:

You should be fine

You could also get past the NSF's with a verif. of deposit. Not all lenders are taking them but most are.

I think you will get the automated approval but even if you dont your debt to income can be a combine 43% so you would still qualify if it had to go manual UW.

Good Luck

Brian

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Thanks for the insight Brian.

Thank you all for your information.