When you’re in college, it seems like the sky is the limit. You get to learn about interesting topics in an environment filled with like-minded individuals. You have professors and advisors who seem to have your best interests in mind, who outline the best courses and route to take to achieve your dream job.
But so often, reality doesn’t hit until you graduate. Soon after you walk across that stage and get your diploma, your student loan payment requests start rolling in. Buying a home and starting a family during this time seems like a pipe dream. How can you possibly make such big investments when you have so much to pay back in loans?
If this sounds like you, don’t worry! There is a way to buy a home with student loan debt, and we’re here to show you how.
Best Ways to Buy a Home with Student Loan Debt
- Improve Your Debt-to-Income Ratio
Lenders look at a number of factors when considering your mortgage rate. One of the biggest items that affects their decision is your debt-to-income ratio. Essentially, if you’re not making a ton of money, and you owe a lot of money, you are not an ideal candidate for a loan. Unfortunately, this describes almost all new graduates.
However, your actions can affect how lenders view you in terms of risk. If you refinance some of your loans and regularly pay off your debt as best you can, you will be seen as a responsible applicant. You can’t necessarily control your salary coming out of school, nor can you control the amount of debt you accumulate through student loans. But you can take small, yet significant steps to improve your financial standing and receive a better mortgage offer.
- Use Available Government Financial Resources
The government organization responsible for financial assistance with regards to prospective mortgage applicants is known as Fannie Mae. Over the years, Fannie Mae has issued multiple recommendations for new graduates who are interested in buying a home. While not all of the recommendations will apply to every new graduate’s specific situation, many of them are applicable to this group.
Some of these options include the use of:
- Student Debt Repayment Calculation.
- Recruiting family or friends to help pay off some of your debt via a repayment method known as “debt paid by others”.
- Student Loan Cash Out Refinance.
- Contemplate a Co-Signer
Having someone co-sign your mortgage is a tempting option and may be a good choice for many new graduates. However, it’s important to note that removing a co-signer from the loan is a long and expensive process. This doesn’t mean you shouldn’t use a co-signer, but you just need to be aware of the extra costs that are likely to occur down the road as the result of using one.
- Partner with a Mortgage Professional
If any of this information feels overwhelming, or if you just feel like you could use some help navigating the world of homebuying with student debt, a mortgage professional can help. These experts know everything there is to know about mortgages and can help get you in a new home quickly. The experts at Rex Homes have more information on their website here: https://blog.rexhomes.com/buying-home-student-loan-debt/
- Virginia Beach Commercial Roof Replacement Contractors August 25, 2023
- The Benefits of Having a 24-Hour Plumber On-Call June 2, 2023
- How Sewer Camera Inspection Can Keep Your Pipes in Tip-Top Shape April 4, 2023
- Professional Painter Service And Safety: What You Need To Know Before Starting A Project March 8, 2023
- Why You Should Never Give Up On Getting Your Dream Home. December 6, 2022
- Quartz Countertops: Making the Right Choice for Your Kitchen November 27, 2022
- Should You Install Flyscreen Doors – Here’s Why It’s a Good Idea. November 24, 2022
- August 2023
- June 2023
- April 2023
- March 2023
- December 2022
- November 2022
- September 2022
- April 2022
- March 2022
- February 2022
- January 2022
- December 2021
- November 2021
- October 2021
- September 2021
- August 2021
- July 2021
- June 2021
- May 2021
- April 2021
- March 2021
- February 2021
- January 2021
- December 2020
- November 2020
- October 2020
- September 2020
- August 2020
- July 2020
- June 2020
- May 2020
- March 2020
- November 2019
- October 2019
- September 2019
- August 2019
- July 2019
- June 2019
- April 2019
- February 2019