Fannie May Student Loan Debt Solutions

Published Thursday, September 7, 2017

Today, 44 million Americans have student loan debt. So, it’s no surprise that student debt may be what’s keeping your client from their dreams of owning a home.

But there’s good news—Fannie Mae recently implemented new policies that may help more potential buyers qualify for a mortgage loan. 

“We understand the significant role that a monthly student loan payment plays in a potential home buyer’s consideration to take on a mortgage, and we want to be a part of the solution,” says Jonathan Lawless, Vice President of Customer Solutions for Fannie Mae.

This policy simplifies the way a lender calculates student debt payments into a borrower’s debt to income ratio (DTI); potentially lowering the borrower’s total DTI percentage. This allows lenders to accept student debt payment information listed on a credit report, even if it's an income-based repayment plan.

Who Can Benefit from the Changes?

These new Fannie Mae policies may be a good fit for your clients who have student debt or debts paid by others, like a car loan or credit card debt. This change Borrowers can potentially qualify for a home they may not have otherwise, or qualify for a higher-priced home.

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