CALL NOW! (866) 655-4411
HomePersonal CreditBusiness CreditResourcesEducationTestimonialsAbout UsContact UsLogin
How It Works
Credit Education
Careers
RPSMixer Events
Credit Monitoring
Secure Credit Cards
Rental Reporting
CE Classes for Realtors
How much is your bad credit costing you?
Pros vs Cons of Renting versus Buying

RECOVER Your Credit Profile!

Contact our experts today to find out how we can help you realize your dreams and change your life!
Contact Us Today
 

Recent Success Stories

       


Can my student loans keep me from getting a mortgage?

Friday, September 05, 2014

The student loans that helped to finance your college degrees may make it more difficult for you to buy a home.

Heavy student loan burdens can delay your home buying dreams for two key reasons.

First off, if you are struggling to pay your student loan payments each month, it can be difficult to imagine saving up enough money for a down payment on a home, especially if you are getting by on a lower-than-expected salary.

And second, too much student loan debt can make it difficult to qualify for a home loan because of its impact on your debt-to-income ratio.

Mortgage lenders use your debt-to-income ratio to evaluate your current debt load and to see how much you can responsibly afford to borrow.

If a potential lender sees that your current debt level is too burdensome for your income level, you will not be approved for a mortgage.

Your Payment History
How well you manage your student loan payments also can impact your ability to qualify for a home loan.

Steady on-time payments of your student loans are good for your credit record and your credit score. Your payment history accounts for about 35% of your credit score and paying your student loans on time each month and every month is a good way to build up a strong payment history.

But if you fall behind on your student loan payments, your credit score could drop significantly, and this can hurt your chances of qualifying for home loan as well. Especially if you fall below the required minimum credit score for the mortgage you’re seeking.

Rather than fall behind on student loan payments, reach out to your lender about deferment and forbearance. If you are unemployed, under-employed or suffering a financial hardship, you may be able to qualify for a postponement or lowering of your student loan payments.

Deferment or forbearance may give you the break that you need on your student loan payments without hurting your credit. Student loans in deferment or forbearance are not generally reported in a negative way on your credit reports or counted as a negative by most credit scoring models.

If you’re thinking of buying a home at some point in the future, and you’re wondering how your student loans are impacting your credit, checking your credit scores is a good place to start. Using Credit.com’s free tools, you can get two of your credit scores updated every month, along with an overview of what’s affecting your credit, and a plan to help you work to improve it.

Comments

Post has no comments.

Post a Comment




Captcha Image


Trackback Link
http://www.risingpointsolutions.com/BlogRetrieve.aspx?BlogID=12805&PostID=1336179&A=Trackback
Trackbacks
Post has no trackbacks.

 

PREPARE FOR A BETTER TOMORROW!
FREE E-Books! Enter your details below
Enter Word Verification in box below
Captcha Image


RECENT POSTS
BLOG ARCHIVE
BLOG TAGS
Copyright 2014 - Rising Point Solutions - All Rights Reserved | Privacy Policy & Affiliate Disclosure

Disclaimer: Improvement of your credit score and/or particular results vary per client. We cannot guarantee any results or improvement as stated in our Guarantee Disclaimer. Following our best results practices and educational consulting, we do typically see improvement in credit scores.