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  • Writer's pictureThe Credit Laboratory - Research Team

Purchasing a home with student loans just got easier

Updated: Jan 4, 2022

When applying for a FHA loan lenders have been using 1% of your total student loan debt towards your debt to income ratio if your students loans were in an income driven payment, if your students were in deferment, or if your student loans were reporting a zero dollar monthly payment.

For example if you had $50,000 in student loan debt a lender would calculated 1% of your total debt, that would be $500, if your student loans are in deferment.

In June 2021, The U.S. Department of Housing and Urban Development updated the guidelines on how student loan debt will now be calculated. Check it out below.

Updated FHA Student Loan Guidelines June21
Download PDF • 160KB

Instead of lenders using 1% of your student loan debt towards your debt to income ratio, they are now using 0.5%. How great is that? That means that if you have $50,000 in student loan debt, instead of the old requirement of $500, it would now be $250.

If you were having trouble getting approved because your debt to income ration was previously to high or if you could not get approved for the amount of house you previously wanted, now may be your time to shine.

You should have a better chance at getting approved if your were having problems because your debt to income ratio was to high. If you were having problems getting approved for student loans because your student loans were in defaulted and they are still in default, this new change may not help you.

If your student loans are in default or collections, it will be best to reach out to your student loan provider and see if you qualify for their Rehabilitation Program. If you don't know how to contact your student loan provider you can always access your student loans at

You can also find information about your student loans on your credit reports. If you don't have access to your credit reports you can get a FREE COPY HERE. You can also receive copies at free every week until April 2022. You will have to login into each credit bureau's website separately so make sure you keep up with all f your passwords.

If you would a Credit Analyst to audit your credit reports and help you get on the path to better credit SIGN UP FOR YOUR CONSULTATION HERE TODAY!!!

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