topic Re: FHA Qualification and Student Loans in Mortgage Loans

FHA Qualification and Student Loans

Anonymous — Tue, 24 Nov 2020 18:51:07 GMT

Happy Thanksgiving! My husband and I are working on preapproval for a FHA loan. I have a very high balance on my student loans and am paying through an income-driven payment plane. When looking at DTI, will the lender consider my current payment amount or go with a percentage. This makes a HUGE difference with us.

Re: FHA Qualification and Student Loans

dragontears — Tue, 24 Nov 2020 19:22:25 GMT

@Anonymous wrote:
Happy Thanksgiving! My husband and I are working on preapproval for a FHA loan. I have a very high balance on my student loans and am paying through an income-driven payment plane. When looking at DTI, will the lender consider my current payment amount or go with a percentage. This makes a HUGE difference with us.

Welcome to the forum @Anonymous

Unfortunately, with a FHA the lender will use 1% of the student loan balance as the payment for DTI unless you can provide documentation that your current payment will fully amortize over the loan period (think extended repayment plan, not any kind of income based plan).

Re: FHA Qualification and Student Loans

Anonymous — Tue, 24 Nov 2020 21:27:55 GMT

Thank you so much for the reply! I can put my loans into the extended payment plan. Do you know if recalculating the payment will impact my credit score?

Re: FHA Qualification and Student Loans

Mortgage-Specialist — Tue, 24 Nov 2020 21:59:13 GMT

It doesn't impact the score.. You don't have to be on a repayment plan, you only need to provide the repayment plan documentation

This means you can still remain in deferment