Ask the Residential Mortgage Underwriter: Does a deferred student loan payment have to be counted in a borrower’s debt ratio?

 

Q: Does a deferred student loan payment affect qualifying and have to be counted in a borrower’s debt ratio?

A: It depends. On a Conventional loan, yes, the payment very much does have to be counted no matter how long the payment might be deferred. If the student loan accounts are new and don’t show a specific payment on the credit report, the loan processor has to contact the student loan servicer and obtain a payment schedule. On an FHA or VA loan, the payments do not have to be counted if there is proof that the student loans are deferred for more than one year. This can sometimes be tricky to obtain but a letter or payment schedule from the loan servicer is the best way to prove this. If the payments begin within the year, then they have to be documented and counted.

November 5, 2012 by · Leave a Comment

About James

James A. Williamson is currently the Sr VP of Sales Development for Shelter Lending Services (formerly Fairfield Mortgage). James joined Shelter in 1994 and was the company's top Loan Officer in GA for 20 straight years helping over 2500 families finance their homes. James now oversees an incredible group of Loan Officers in Atlanta while further building Shelter's Atlanta business.

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