FHA has taken away the option to not count student loan debt against borrowers if the student loans are deferred or in forbearance, effective September 14, 2015.

Mortgage Application with Contracts Before 9/14/2015

  • Will use actual documented loan payment
  • If deferred for less than 12 months at closing, will use 5% of balance owed if future payment can not be proved with documentation
  • If deferred for more than 12 months at closing, debt is not counted

Mortgage Application with Contracts On Or After 9/14/2015

  • Will use actual documented loan payment
  • If deferred (regardless of how long), will use future payment amount
  • If loan is in deferment and future payment cannot be determined, will use 2% of the balance owed
  • If student loan is currently on an income-based repayment plan and payment is zero, use zero for qualifying
  • If student loan is currently on a graduated payment plan, use payment for qualifying
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