What you should know about student loans before you buy a home or refinance.

Student loans can affect the loan process in multiple ways. They could limit you on how much you can buy or they could prevent you from buying a home all together. We will look at how student loans affect FHA, VA, USDA & conventional loans.

Student loans are looked at differently depending on what type of loan you are looking for. I will explain how FHA, VA, Conv. & USDA loans are affected by student loans.

If you are defaulting on a government sponsored student loan you will not get a FHA, VA or USDA mortgage until it is brought current. However you may be able to get a conventional mortgage depending on certain criteria.

If your student loan is deferred for 1 yr. from the closing of your mortgage FHA & VA will allow you to exclude those payments from your debt to income ratio. If you are applying for a Conventional or USDA mortgage the student loan payment will be used against you even if the payments are deferred.

So now you can see how a student loan payments can lower what you qualify for, or even stop you all together from getting a mortgage. If you have student loan payments you need to go to a mortgage company that will allow higher debt to income ratios, like Barclay Butler Financial Inc.