Lenders and IBR - please help

[Anonymous]

Which lenders will currently allow student loan payments to be counted as zero under IBR? I’ve seen some older posts but it seems like this changes frequently.

I’m at a loss and don’t know what to do. We just spent about $10k paying off debt and scrambling because our landlord is selling our rental. My student loans are over $100k. If 1% is attributed to me for monthly payments (then a few hundred for my husband) we effectively cannot buy a home. We had been looking at USDA and a loan program in our state. When I spoke with a mortgage person from the bank she just wanted to make sure they weren’t in deferment or forbearance. She never said IBR could be a problem. My understanding is the time in IBR counts toward the life of the loan so if I have a 25 year loan, the loan length decreases every year I’m on IBR.

I basically can only work part time. I have a chronic illness that limits me some but it’s one that is almost never approved for disability so I don’t see any point in trying to discharge them in bankruptcy. I’m going to be devastated if this keeps us from owning a home. An average house in our area on the smaller side is $350k and moving isn’t an option due to my husband’s job requirement.

[homeloanexpert]

Your only option is a Conventional. Both Fannie and Fredde offer better options for consumers with student loans. We are allowed to use your IBR not the 1% like FHA or USDA. Let me know if you have any further questions.

Best wishes to you

[Anonymous]

I just went through / am going through this issue. The bottom line is that no lender I know of (Conventional) will accept a $0 payment. I recently consolidated my student loans and Fedloan (seriously the worst) reported the consolidation and a $0 monthly payment!!! I'm on REPAYE. The reported this on Feb 31, 2018 and hadn't updated since then to the actual payment. Navy Fed accepted my IDR paperwork showing my monthly payment without any problems. They refused to take the $0 payment listed on my credit report (which was clearly incorrect).

Bottom line - try to get at least a $1 monthly payment on a new IDR program.  As soon as it gets approved, get all the paperwork, and then dispute your credit report to have it updated to the new monthly payment. You should be good to go, but only with a conventional mortgage.

[Anonymous]

I would recommend you search for small banks/credit unions in your area that specialize in low down payment conventional loans that can take the IBR into consideration. What if your significant other were to carry the mortgage alone instead? Is that an option? That is what my partner and I had to do due to my high student loans causing my DTI to be outrageous.  

[homeloanexpert]

If you get a letter from FedLoan stating your actual payment, the Loan Officer can correct the report. I've done it dozens of times.