After June 30th 2016, it will be more difficult for those with income adjusted student loan payments to qualify for a FHA Mortgages.
Currently, those who have income-adjusted payment plans on student loans are being considered for FHA loan eligibility using the low or deferred payments when calculating debt to income ratios. After June 30th, Mortgage companies will be required to use the full monthly payment of student loans when determining debt to income ratios. Lenders will now have to use the minimum payment amount, regardless of whether or not you are paying it, or can even afford it. These changes will keep many people, especially Millennials and Gen Xs, from qualifying for a FHA mortgage that they may have been able to just a few short months ago. (http://portal.hud.gov/hudportal/documents/huddoc?id=16-08ml.pdf)
Find out how much home you can afford and get pre-approved before these change go into effect by contacting your mortgage broker sooner rather than later.
In order to qualify for the current, more favorable loan guidelines, FHA case numbers must be registered by June 30th.
By Matt Stark
Lead Broker | Search Homes NW Group