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Help with IBR

hall0509
Valued Member

Help with IBR

We have been through a lot over the last few months in regards to trying to get a conventional mortgage but FHA would work out much better for us. I know that FHA will now accept IBR (>$0) but how does that get reported on credit reports? What I mean is I have 18 student loans all serviced by one company. If my IBR is $100/month, does it split that on the credit report across all 18 student loans or does it report it on the highest balance? If it does not split it across all 18, then how would it help since they would have to use .5% on all the other loans that are reported at a $0 payment? Could someone please explain to me how this works so I can decide if it makes sense to recertify my loans to show a payment that is more than $0

6 REPLIES 6
NC_Mtg_Loaner
Valued Contributor

Re: Help with IBR

When it comes to student loans in IBR's---It's likely you'll need to provide proof of payment information that gets verified by your lender and an independent third party verification system.

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Licensed NC Mortgage Loan Originator
Message 2 of 7
hall0509
Valued Member

Re: Help with IBR

Yeah I have no problem with that. My lender just said, recertifying so that I show a real payment instead of $0 will only work if it shows a payment amount on all 18 of my student loans. I cant seem to find anyone who knows how that works. Does the IBR payment amount get spread across all 18 loan accounts when it comes to how it is reported on credit?  Or will it just show the IBR payment on one of the loans? Not even the student loan servicer knew...

 

I dont want to recertify my loans and go from IBR $0/month to IBR $100/month if it isnt going to allow me to get FHA. .5% of my student loans is too high

Message 3 of 7
hall0509
Valued Member

Re: Help with IBR

Update in case anyone deals with this in the future:

Simple solution is to consolidate the loans into one loan and then do the IBR on that one loan. Thats the payment that will show up on credit and lenders will use, even for FHA now. 

Message 4 of 7
nhlbluesgirl
Valued Member

Re: Help with IBR


@hall0509 wrote:

Update in case anyone deals with this in the future:

Simple solution is to consolidate the loans into one loan and then do the IBR on that one loan. Thats the payment that will show up on credit and lenders will use, even for FHA now. 


 

@hall0509  Did you consolidate with the same loan servicer? What is the consolidation process like? I'm in a similar situation. 

FICO 8 as of 1/8/2022:


Message 5 of 7
hall0509
Valued Member

Re: Help with IBR

Yes I did with same servicer. This is what happened so far. 

I applied for consolidation through studentaid. Aidvantage handles all consolidation applications. So within a day or two they mailed out a loan summary letter. You get 10 business days from date of that letter to review and make any changes. I called and waived the remaining days on mine to speed things up and then it took about a week or so for them to complete the consolidation and send payment over to my servicer. Now my old loans all showed paid off for the last 10 days and my new one has not populated yet. Ive called my servicer 10+ times and gotten different information every time but they say it takes 30-60 days from date of application for everything to be complete. Im at like 35 days

 

Hope this helps

Message 6 of 7
RainbowRobb
New Member

Re: Help with IBR

Howdy,

We close on our first house on 2/1 and have over $350k in student loans between us (A failed Medical School attempt will do it). Our total IBR monthly payments come to ~$400/month, so going from the payment was extremely important to us ha ha. 

 

I (4 years post CH7) can speak to how Navy Federal, Better and NBKC's underwriters handled this. When you log-on to your payment portal for your student loans, there is a tab to print a loan/mortgage statement. Those are all the underwriters required for each of our 3 loans, at each of those three financial institutions. I was panicking that they would (unfoundedly so) not honor the Freddie and Fannie guidlines, they did. 

 

When you call your potential lender, you need to ask if they have a policy outside or on top of the Freddie or Fannie guidelines for conforming loans, in regards to student loans. 

Message 7 of 7
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