Blog Category: student loans

school loans

Deferred Student Loans Are Not Deferred?

It used to be that when I was qualifying a mortgage borrower and they told me that their student loans were deferred, I could normally count on not using that debt against them in their debt ratios. However, as we all know underwriting guidelines are stricter these days. Now deferred student loans still have to be counted against mortgage borrowers’ debt ratios, even when no payments are being made and they are in deferred status.

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Getting A VA Mortgage Approved With Student Loan Debt

Have student loan debt and getting a mortgage? When calculating a student loan payment on a VA loan there are various rules. These relate to what monthly payment is counted on that student loan debt.

What if documentation shows the student loan debt will be deferred at least 12 months beyond the closing date? Then no monthly payment is counted.

What if a student loan is in repayment or scheduled to begin within 12 months from the date of a VA mortgage loan closing? Then the lender must consider the anticipated monthly payment in calculating the debt-to-income ratio. A payment is established by calculating each loan at a rate of 5% of the outstanding balance divided by 12 months. Read More