Private College Student Loan - How do student loans affect a mortgage application?

How do student loans affect a mortgage application?

I have $60,000 in various student loans, but since consolidating my combined payment is only $300/month. I have no other debt. Do lenders view student loan debt differently due to the flexibility of the loans? Also, would they look more at the total amount of the debt or the monthly payment when determining the rate and loan amount?

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With 20 years experience in the mortgage business, I have never seen a student loan that was in repayment treated any differently than any other long term debt. While you may be able to ask for a hardship deferral in the future, which is the only advantage on a student loan that doesn’t exist on a standard installment loan, no lender wants to anticipate that circumstance. As long as the payments extend past 10 months in the future, the lender will only use your monthly payment as part of your qualifying ratios. The total debt is not that important and would only be a minor factor. What will matter more is your payment history on the student loan: it should be perfect. It all comes down to the quality of your credit history and your qualifying ratios of debt/income.
I would echo the poster above me. The amount of debt will be taken into consideration on your credit score. The $300 a month will be taken into account on your DTI. Go find a home because it appears the First time home buyers tax credit will be extended. Below are 3 things not to do when you are looking to get a mortgage. When you know that you're going to be buying a home in the next six months or so, you should place a moratorium on certain things that can inhibit your options. Planning ahead is crucial to buying a home, particularly if you don't have extensive financial resources. Mortgage lenders will be scrutinizing your finances carefully, don't give them any reason to reject your application. Major Purchases If you're buying a home, don't invest in any major purchases. Cars, weddings, jewelry, furniture and electronics can all wait until you're settled in your new home. When you make a major purchase, you limit the amount of money available for your down payment, and decrease the amount of liquid capital in your name. If you do have to make a major purchase before buying a home, you might want to put it on a low-interest credit card until after your mortgage application is approved. Sometimes you can't control what life throws you, but think carefully about your options before making a decision. Investments It is also a bad idea to make investments just before buying a home; again, you're decreasing the liquidity of your assets. If you've come across a new stock in which you'd like to invest or if it's a great time to buy bonds, wait until after you've settled the finances on your home. Furthermore, you'll have to disclose all of your finances before buying a new home, which means accounting for every withdrawal and deposit in all of your accounts. This can get quite tedious, especially if you're trying to dig up canceled checks for the new sofa and loveseat you just had to have three months ago. Employment Before buying a home, try not to change jobs. Your employment is a key factor in the mortgage approval process, and if you can't show steady gainful employment, you might be denied. Of course, you can't help matters if you've just been laid off or an opportunity presents itself that you can't pass up. If you're going to change jobs before buying a home, wait another six months before going ahead with the real estate transaction. This gives you an opportunity to establish employment and to show a steady income of paychecks from a single employer. This looks much better on a loan application than a long list of recent employers. Financial Institutions Changing banks is always a hectic ordeal, so don't do it before buying a home. You'll have to provide information about previous accounts that are now closed, and therefore inaccessible. And if you diversify your money too much in money market accounts, savings accounts, checking accounts and other places, you'll have a harder time with the disclosure process. If you're fed up with your bank and want to change, tough it out a little longer and switch after your mortgage is approved and you've set up shop in your new house. This will save you hours of headaches and frustration. As mentioned above, there will be times when you can't avoid all of these things before buying a home, but know that it's in your best interests to wait until the dust settles, so to speak. The goal should be to move into your new house with as few obstacles as possible.
Student loans effect a mortgage application just the same as any other debt would. With $60,000 in outstanding debt it may be hard to get a mortgage loan unless you make around $200,000 a year. They will look at the total amount of debt you owe and also the monthly payments and what the monthly payment of your mortgage payment will be. Plus insurance and taxes which will have to be paid on the house and property you are trying to buy.
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