Quick question??? Student Loans

[claimit]

I think I know the answer to this question, but just would like to confirm,

 

I spoke to a person from BOA mortgages, as he reviewed my credit report he claims my student loans will not count as installment, he says when calculating my DTI they will look at my student loan balance when calculating DTI, I thought they are suppose to calculate my student loans based on my monthly payment correct????

 

He says he needs to double check, I have learned that loan consultant do not know much about the credit requirements.

 

your thoughts?????

[TxQuiltGirl]

I'm not sure your question .. but ...

 

ALL installment loans are considered for your DTI, as are your credit cards.

 

Student loans are installment accounts.

[lil_walnut]

I know you've been bounced all over the place, but you may get a better answer in the Mortgage forum since this appears to be related to getting a house. If I'm wrong, sorry.

 

I do know fla-tan moderates this forum as well as the mortage one, so he may anwer you here.

[odudave]

Generally, they do count toward DTI. I have purchased several homes with student loans on my credit report. The rule each time was that they do count toward DTI. IF you can get a documented one-year forbearance, then many lenders will drop it from the DTI calculation. With my purcahses, I qualified with it counting toward DTI on one, so it wasn't even an issue. On the others, it did count, so I requested a forbearance and submited a copy of the approval to the mortgage company. A couple of other times, I was in an in-school deferrment and I gave them the paperwork showing that,which they accepted. Give yourself enough time for the student loan lender to process it. Mine are through Direct Loans and it can take a little bit to receive the forbearance approval letter!

Edited May 15, 2006 by odudave

[cjen22]

Most Lenders are going to include these in your DTI ratio - even if your loans are in deferment. The typical payment to use in determining this is 5% of your balance or you can call your student loan lender to determine what your payment will be after you are out of deferment. Typically the only way to not include these student loan payments is if you are going to be attending school for an extended period of time (possibly medical) and if it is proven that you are going to be making a considerable amount of income as soon as you are done with shool (again possibly medical).