Mortgage Loans

[JPersat]

Do student loans factor in majorly to DTI? I started school last November and am going thru a associates to BA to MBA, so it's gonna take me a while before I'm out of deferment. Why do they even factor them in if repayment isnt for at least another 5 years?!?

[deg757]

From what I understand they don't count them as long as they aren't due to start being repaid within the next 12 months.

[JPersat]

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deg757 wrote:

From what I understand they don't count them as long as they aren't due to start being repaid within the next 12 months.

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Our LO said they're factored into DTI along with our car payments and cc bills (credit card debt free thank god!!!).

If we didn't have two car payments Iwouldn't be worried about my student loans, but we're going to be cutting it close on the back end DTI.

[deg757]

How do they know what your payment will be especially if you are still incurring more debt while in school? I assume that you are still borrowing to pay for school.

[JPersat]

That's what I wanna know...I emailed our LO and she said they contact the credit agency that's handling my student loans and said they could give them a monthly payment..but I'm sure my monthly payment will change when I owe 100k compared to 11k..

[bigboihill]

I know that lenders may vary and different circumstances may require different measures.  However, it sounds like you are applying for a mortgage that is not FHA.  FHA guidelines state that as long as  your student loans are deferred for at least 12 months post closing, then they don't have to be counted into your DTI.  USDA, VA, and regular conventional loans will count them regardless.

[JPersat]

That seems completely assinine..like taxing me on money I haven't made yet :-/  at least I'm going in with only an 11k balance instead of the anticipated 100k...