[00:00:00] Speaker A: In this episode, we talk about how.
[00:00:01] Speaker B: Your federal or private student loan payment will impact your search for your next home.
[00:00:06] Speaker A: Let's get started.
[00:00:09] Speaker C: Are your student loan payments or loan.
[00:00:11] Speaker A: Balances a major obstacle in your financial life?
[00:00:14] Speaker C: Then tune in and let's escape student loan debt.
[00:00:19] Speaker B: Hello.
[00:00:20] Speaker A: My name is Brenton Harrison of escape.
[00:00:21] Speaker B: Student Loan debt and your host for the Escape Student Loan debt podcast. Over the past several months, months, we.
[00:00:27] Speaker A: Have been kind of bogged down, going through the myriad of updates and extensions that have been associated with federal student.
[00:00:36] Speaker B: Loans, really since the pandemic.
[00:00:37] Speaker A: So there have been times where we've been able to dip into private loans.
[00:00:41] Speaker B: There have been times where we've been able to dip into co signing and refinancing. But for the most part, there's been.
[00:00:46] Speaker A: So much going on with federal loans.
[00:00:49] Speaker B: That we've kind of made the main.
[00:00:50] Speaker A: Thing, the main thing this bi weekly period.
[00:00:53] Speaker B: However, we have some time to go.
[00:00:55] Speaker A: Into kind of one of like, the sideline items that associated with federal or.
[00:01:00] Speaker B: Private student loan debt, and that's its impact on other elements of your finances, like not just investments, but also, in.
[00:01:07] Speaker A: This scenario, your ability to buy a home. So I want to go through one.
[00:01:11] Speaker B: Of the two most important elements in a your ability to buy a home in the first place and be the structure of what that purchase looks like in terms of your loan. And then we'll go through some specific types of mortgages so you can see the impact of your student loan payment on your ability to get approval for financing.
[00:01:29] Speaker A: And as I reference what I think.
[00:01:31] Speaker B: Are the two most important elements in.
[00:01:33] Speaker A: Getting approved for a home loan.
[00:01:34] Speaker B: What I'm referring to is your credit.
[00:01:36] Speaker A: Score and also your debt to income ratio.
[00:01:39] Speaker B: So your credit score is pretty straightforward.
[00:01:41] Speaker A: Your credit score is, depending on the.
[00:01:44] Speaker B: Type of score that you're accessing, a snapshot in time. Or if you're looking at your vantage.
[00:01:49] Speaker A: Score, it is a trend over time of how you have managed certain elements of your credit. Now, I would say in all cases.
[00:01:57] Speaker B: That I come across, a mortgage lender is going to ask for your FICO score.
[00:02:02] Speaker A: So there are many different types. I often come across people who will be looking at, like, a credit karma, and they'll say, well, my credit karma.
[00:02:10] Speaker B: Score says this, but my FICO score, when they ran into the lender, says.
[00:02:13] Speaker A: That that's because credit karma and many credit card issuers, when it comes to.
[00:02:18] Speaker B: Showing you your score, they're showing you your vantage score, which is a different type of credit score than what your lender may be checking, which in many cases for a home loan, is going.
[00:02:28] Speaker A: To be the FICO score.
[00:02:29] Speaker B: So if you're following along on screen.
[00:02:30] Speaker A: And we'll put this article in the.
[00:02:32] Speaker B: Show notes, you're looking at the elements of a FICO credit score in terms.
[00:02:35] Speaker A: Of what percentage makes up your score.
[00:02:38] Speaker B: Let's look at this through the lens of how it could be impacted by your student loans. 35% of your score, the largest percentage of your FICO score, is literally just your payment history.
[00:02:49] Speaker A: Do you or do you not pay your bills on time? We'll come back to that in a second.
[00:02:54] Speaker B: 30% of your credit score is your credit utilization.
[00:02:58] Speaker A: So if you have things like revolving.
[00:03:00] Speaker B: Debt, like a line of credit or a credit card, this portion of your score, which is 30% of your score.
[00:03:07] Speaker A: It takes into consideration what percentage of.
[00:03:10] Speaker B: Your available credit you have borrowed at the time that they're checking your score. 15% of your credit score is the age of your credit.
[00:03:18] Speaker A: Every single time that you take out a new line of credit, it has a birthday.
[00:03:22] Speaker B: The older the average age of your.
[00:03:24] Speaker A: Accounts that you've opened, the better it.
[00:03:26] Speaker B: Reflects on your score. So in this case, the longer you've.
[00:03:29] Speaker A: Had credit, the better 10% of your.
[00:03:32] Speaker B: Score is your credit mix. What blend of credit do you have? Do you have all credit cards? Do you have credit cards and a.
[00:03:38] Speaker A: Student loan plus a car loan? Believe it or not, for this small.
[00:03:42] Speaker B: Portion of your score, the more diverse.
[00:03:44] Speaker A: The types of credits you have, the better. And then 10% is new credit, meaning credit inquiries.
[00:03:50] Speaker B: The more people you have checking your credit in a short period of time, the worse it is for this element of your score. Typically, when it comes to your credit score, a credit inquiry will fall off after a year. It will fall off your credit report after two years. Looking at this through the lens of student loans, your payment history for student loans is incredibly important because if you have late payments or at worst, defaulted.
[00:04:16] Speaker A: Student loans that can stay on your.
[00:04:19] Speaker B: Credit report until it's resolved, and even after it's resolved, that status, or a late payment or a missed payment in some instances, can stay on your credit report for up to seven years. The payment history in terms of a defaulted status. If you're looking for a federally backed.
[00:04:34] Speaker A: Mortgage, which is really important because most mortgages that people are using when they're trying to get like a first time home loan, they're using a federally backed mortgage.
[00:04:43] Speaker B: That status, because you're taking out. In most cases, a federal student loan.
[00:04:48] Speaker A: Not only shows up on your FICO score, it also shows up on something.
[00:04:52] Speaker B: Called your CaIVRS report.
[00:04:54] Speaker A: CaIVR stands for if you're looking on.
[00:04:56] Speaker B: Screen, the credit alert verification reporting system. I'm reading and I quote, CAIVRS was.
[00:05:01] Speaker A: Developed by the Department of Housing and.
[00:05:03] Speaker B: Urban Development in June 1987 as a shared database of defaulted federal debtors and enables processors of applications for federal credit to identify individuals who are in default or have had claims paid on direct or guaranteed federal loans.
[00:05:18] Speaker A: What this is essentially saying is if you default on one federal loan, that.
[00:05:23] Speaker B: Agency will tell other agencies in case.
[00:05:26] Speaker A: You try to borrow from them as well. And if you're trying to get a federally backed mortgage, like what most people do with a first time home buyer loan, and you have a student loan in default, not only does that destroy.
[00:05:38] Speaker B: Your payment history, which is the largest part of your score, it also, in many cases, will make you ineligible for other federal forms of debt.
[00:05:47] Speaker A: So even though the rest of your.
[00:05:48] Speaker B: Finances could be pristine, if you have a student loan that's in default status.
[00:05:53] Speaker A: You may be forbidden from taking out.
[00:05:55] Speaker B: A federally backed mortgage.
[00:05:57] Speaker A: Now, let's look at the next portion. 30% of your score is your credit utilization. We talked about credit cards and lines of credit. If there is a positive to having.
[00:06:06] Speaker B: A federal student loan, that as it pertains to credit, at least it is.
[00:06:10] Speaker A: That student loans do not show up for credit utilization. So this 30% of your score cannot be adversely impacted by having a student.
[00:06:19] Speaker B: Loan because it only assesses revolving debt.
[00:06:23] Speaker A: And student loans are a type of debt that are called installment debt, and as such, they're not reflected the next percent age of your credit, 15% of your score. That's something where, believe it or not, because most of the time you're taking.
[00:06:36] Speaker B: Out student loans before you're in your.
[00:06:37] Speaker A: Professional career, which means you have them for a long time, that actually can.
[00:06:42] Speaker B: Help your credit score because the older the average age of your credit, the better.
[00:06:46] Speaker A: So it's not something in most cases.
[00:06:48] Speaker B: That will hurt you.
[00:06:49] Speaker A: Even though you don't want to have.
[00:06:50] Speaker B: Student loans to have old credit, in this case, it actually helps you.
[00:06:54] Speaker A: And then credit mix and credit inquiries.
[00:06:57] Speaker B: Because they're both 10% of your score each, they're so small.
[00:07:00] Speaker A: It's not something that I'll be paying.
[00:07:02] Speaker B: Much attention to when it comes to your student loans because cumulatively they're 20%. Whereas if you just look at payment history alone, it is 15% higher than.
[00:07:12] Speaker A: Those two elements combined. So that gives you an idea of.
[00:07:15] Speaker B: How your student loans can impact your credit score and how it always benefits you to pay things on time. And if you pay things on time as it pertains to credit, you should be okay when it comes to the mortgage process.
[00:07:29] Speaker A: The reason I bring up that is because credit, when you look at how.
[00:07:33] Speaker B: It impacts your mortgage, your score determines the interest rate that you receive on the new mortgage.
[00:07:40] Speaker A: So we'll talk about how much you're.
[00:07:41] Speaker B: Approved for in a second.
[00:07:43] Speaker A: But when you have a high credit.
[00:07:45] Speaker B: Score, the only thing that it really.
[00:07:46] Speaker A: Impacts is when I look at that mortgage, am I, for example, going to pay 7.5% or because my credit score.
[00:07:54] Speaker B: Is strong, I can pay 7%? The higher your credit score, the lower.
[00:07:59] Speaker A: It can drop the interest rate, the.
[00:08:01] Speaker B: More money it saves you over time.
[00:08:03] Speaker A: And when you're talking about a mortgage.
[00:08:04] Speaker B: That you could have for 15 to 30 years, even a difference of half a point on a mortgage could mean tens of thousands of extra dollars that you have to pay over the course.
[00:08:14] Speaker A: Of that repayment period. It's also important that you understand, especially.
[00:08:17] Speaker B: If you're applying for a mortgage with.
[00:08:19] Speaker A: Somebody else who may be struggling with student loan debt and have an adverse impact on their credit, that most lenders.
[00:08:26] Speaker B: When they have two applicants on a home loan, they take the lower of the two scores. So if you're doing great with your student loans and your credit, and you have an 800 credit score, but you're.
[00:08:36] Speaker A: Applying with someone who's in default or.
[00:08:39] Speaker B: Just has a bunch of late payments.
[00:08:40] Speaker A: And they have a 625, then they're going to go off the 625, and.
[00:08:45] Speaker B: It'S either going to make your rate.
[00:08:46] Speaker A: Go higher, or in some cases, that.
[00:08:48] Speaker B: Person'S credit may be so bad that.
[00:08:50] Speaker A: You either can't qualify for a home.
[00:08:52] Speaker B: At all, or you have to remove.
[00:08:54] Speaker A: Them from the application and take your.
[00:08:57] Speaker B: Chances at applying for the loan on your own.
[00:09:00] Speaker A: And if you have to apply on your own, the next element that's crucial.
[00:09:04] Speaker B: When it comes to student loans and.
[00:09:07] Speaker A: Your mortgage is debt to income ratio. Debt to income ratio is an expression.
[00:09:12] Speaker B: Of how much of your monthly income.
[00:09:14] Speaker A: Is swallowed up by your monthly debt payments. So, for example, if I have a $10,000 monthly income and $5,000 of monthly.
[00:09:23] Speaker B: Debt payments, I have a 50% debt to income ratio.
[00:09:27] Speaker A: And while your credit score determines the.
[00:09:30] Speaker B: Interest rate that you may receive on.
[00:09:31] Speaker A: Your mortgage, your debt to income ratio actually determines how much you're able to borrow, because a lender does not want you to take on your new debt and be overextended, not because they care about you, but because they want to.
[00:09:44] Speaker B: Make sure that if you're in a pinch financially, that you can pay them back first.
[00:09:49] Speaker A: If youre looking on screen, well put this in the show notes. Theres an article from Bankrate that goes.
[00:09:54] Speaker B: Through how student loans can impact your mortgage.
[00:09:57] Speaker A: And youre looking at these debt to income ratios, and it tells you what.
[00:10:00] Speaker B: A lender will think.
[00:10:02] Speaker A: If you have a debt to income.
[00:10:03] Speaker B: Ratio below 36%, meaning that less than 36% of your monthly income is swallowed up by debt payments, then youre good. A lender will think that you have the ability to take on more debt, in this case a mortgage.
[00:10:16] Speaker A: If your debt to income ratio is between 36% to 49%, it's okay. And they are probably going to sweat.
[00:10:23] Speaker B: You a little bit more and ask.
[00:10:24] Speaker A: About certain expenses to figure out if you can take on that debt.
[00:10:28] Speaker B: But if you're above 49%, you will.
[00:10:31] Speaker A: Not be able to qualify for that home loan. So let's say that you're straddling the fence and you are trying to get.
[00:10:38] Speaker B: A home that's $300,000. And that $300,000 mortgage, or whatever it.
[00:10:43] Speaker A: Is that you're actually borrowing, would bump.
[00:10:45] Speaker B: You up over the 50%.
[00:10:47] Speaker A: Your lender may say, well, you can't borrow 300,000. You're limited to 250,000 because that additional.
[00:10:54] Speaker B: Debt will keep you below our requirements.
[00:10:56] Speaker A: For debt to income ratio. So credit determines the interest rate. Debt to income ratio determines how much.
[00:11:03] Speaker B: You'Ll be approved for in terms of how much you can borrow.
[00:11:06] Speaker A: And this is where it gets really.
[00:11:08] Speaker B: Important when it comes to student loans, because if you'll recall, with things like income driven repayment plans, you have a.
[00:11:15] Speaker A: Whole lot of debt that you may not be paying enough on a monthly.
[00:11:18] Speaker B: Basis to actually pay pay off in full. So it's very important to understand whether your lender is going to accept your.
[00:11:25] Speaker A: Income driven repayment plan payment or if.
[00:11:28] Speaker B: They'Re going to go off the amount that's actually needed to pay off your loan in full when they consider its impact on your debt to income ratio. And after the break will tell you.
[00:11:38] Speaker A: How, based on the type of loan.
[00:11:39] Speaker B: For which you're applying, that could be impacted. This is the escape Student Loan Debt.
[00:11:45] Speaker D: Podcast, a show for established professionals whose student loan payments or loan balances are impacting their marriage, their business, their credit, or their dream of achieving home ownership. We'll be right back.
[00:12:01] Speaker C: Are you interested in learning the tools and techniques we use to get student loans forgiven, reduced, reorganized, or expedited? Well, great news. We're currently updating our flagship course escape student loan debt to reflect the current changes in the student loan land. To stay up to date on the launch of the course and opportunities to sit in on our live recording sessions, head to escapestudentloanedebt.com and join our email list.
[00:12:25] Speaker A: Now.
[00:12:28] Speaker D: You'Re listening to the escape Student loan debt podcast.
[00:12:32] Speaker B: Subscribe
[email protected].
[00:12:35] Speaker D: Dot welcome back.
[00:12:38] Speaker A: Welcome back.
[00:12:38] Speaker B: Before the break, we were talking about credit scores and debt to income ratios.
[00:12:42] Speaker A: And now it's time to talk about, based on the type of mortgage for.
[00:12:46] Speaker B: Which you're applying, how you're lender will view the payment that you're making towards your federal or private student loans.
[00:12:54] Speaker A: And I will tell you, for private student loans, it just kind of is what it is.
[00:12:57] Speaker B: Because with a private student loan, the payment that you're making is the payment that you're making. It's also what your lender will report to the credit bureaus. And with a private student loan, when you're applying for a home loan and a lender's trying to calculate your debt.
[00:13:10] Speaker A: To income ratio, they're going to go.
[00:13:12] Speaker B: Off of what is reported on your credit report.
[00:13:16] Speaker A: And because with a private loan, it's.
[00:13:18] Speaker B: One in the same, what your lender.
[00:13:20] Speaker A: Is, what you're actually paying. It's kind of straightforward.
[00:13:23] Speaker B: Now, I will say, based on debt.
[00:13:25] Speaker A: To income ratio, if you are someone who has gotten too aggressive in how.
[00:13:30] Speaker B: You'Ve structured your private student loan, there.
[00:13:33] Speaker A: May be some relief. For example, you have people who get.
[00:13:36] Speaker B: Too aggressive and they say, oh, I'm.
[00:13:37] Speaker A: Going to sign up for a five.
[00:13:38] Speaker B: Year or a seven year repayment for.
[00:13:40] Speaker A: This student loan because they're treating that.
[00:13:42] Speaker B: Student loan as if it's the only thing in their finances. Then they try and apply for a.
[00:13:48] Speaker A: Home loan and their debt to income ratio is too high because partially they're.
[00:13:52] Speaker B: Required or guaranteed payment that they have to make towards that private student loan is too high.
[00:13:57] Speaker A: So we have had scenarios where an option that a person may have is.
[00:14:01] Speaker B: To actually refinance that loan and extend.
[00:14:04] Speaker A: The repayment period may not make much sense to you. But when you think about the fact that everything you do in one area of your finances impacts the other, it.
[00:14:12] Speaker B: May in some cases make sense.
[00:14:14] Speaker A: If you're trying to get into a home where instead of having a seven.
[00:14:18] Speaker B: Year loan at 5% interest, you refinance.
[00:14:21] Speaker A: It at what is likely going to.
[00:14:22] Speaker B: Be a higher rate, maybe eight or 9%. But you stretch that payment out to 15 or 20 years because it will lower the required payment, lower what's listed.
[00:14:33] Speaker A: On your credit report, and improve your.
[00:14:35] Speaker B: Debt to income ratio to the point where you may be able to qualify for the home. Once you get in the home, you can then do whatever you want to.
[00:14:42] Speaker A: You can pay extra on that loan.
[00:14:44] Speaker B: If rates are favorable, you can refinance it right back down to a 7%. But while you're trying to get that home is something to consider.
[00:14:52] Speaker A: You don't want to get too aggressive right before you buy something because you're going to find yourself in a situation where you'll wish you had been a little less aggressive when it came to that.
[00:15:01] Speaker B: Private student loan repayment. With federal student loans, however, you have to consider the fact that you have, in some cases, even though I hate this payment plan, a graduated extended payment.
[00:15:12] Speaker A: But the majority of the things that we're going to be discussing are income driven repayment plans. And you have on the page, if.
[00:15:19] Speaker B: You'Re looking a series of federal or.
[00:15:21] Speaker A: Federally backed loans that all have different.
[00:15:24] Speaker B: Guidelines in terms of how they view the amount that you're paying on your student loans as compared to the actual balance of the debt.
[00:15:31] Speaker A: For example, if you're looking at a Fannie Mae loan, you can see that.
[00:15:35] Speaker B: The monthly student loan payment that's listed on your credit report or your student loan statement is what they will use.
[00:15:42] Speaker A: So that means you could owe a.
[00:15:44] Speaker B: Million dollars in student loans if you have an income driven repayment plan that says you're paying $10 a month and that's what's listed on your credit report or a student loan statement, even though.
[00:15:55] Speaker A: You owe a million dollars, a Fannie Mae loan and a lender will use that $10 payment when it comes to calculating your debt to income ratio.
[00:16:04] Speaker B: However, and this may seem odd, if your loan is deferred or it's in forbearance, they will take either 1% of the balance or one monthly payment.
[00:16:15] Speaker A: So, for example, let's say that we have a student loan that is $100,000 and you are applying for a home loan, and you think because you're applying for a home loan that the best.
[00:16:26] Speaker B: Thing to do is to put your student loan in deferment.
[00:16:28] Speaker A: Well, in that scenario, you would be mistaken, because on an income driven repayment plan, maybe it says that your monthly payment is $200. But if you put that loan into.
[00:16:38] Speaker B: Deferment or forbearance, your lender may take 1% of the loan balance and use.
[00:16:44] Speaker A: That as the monthly payment.
[00:16:45] Speaker B: 1% of $100,000 is $1,000 a month. So instead of them using an IDR payment that might have been 200 a month when calculating debt to income ratio, even though you're not paying $1,000 a month on this deferred loan, they use.
[00:17:00] Speaker A: $1,000 a month as the payment because.
[00:17:02] Speaker B: Of the deferred status.
[00:17:04] Speaker A: So this is a perfect example of.
[00:17:06] Speaker B: Needing to understand the regulations of the type of loan that you were applying.
[00:17:10] Speaker A: For and how that loan looks at.
[00:17:12] Speaker B: Your student loan payment. The next that you see is a Freddie Mac loan.
[00:17:16] Speaker A: Freddie Mac uses the monthly student loan.
[00:17:19] Speaker B: Payment as it's listed on your credit report or the student loan statement. So it's very similar to the Fannie.
[00:17:24] Speaker A: Mac, except with them, if your monthly.
[00:17:27] Speaker B: Payment reported is zero, which can be.
[00:17:29] Speaker A: The case if you're in deferment forbearance or you make too little, and an.
[00:17:34] Speaker B: Income driven repayment plan just calculates your payment at zero. In that case, they use 0.5% of the balance.
[00:17:42] Speaker A: So let's assume that we have a.
[00:17:43] Speaker B: Person who may be making good money.
[00:17:45] Speaker A: Now, but because of how they're utilizing.
[00:17:47] Speaker B: The income driven repayment plan system, they.
[00:17:50] Speaker A: Have a payment that's $0 because maybe, you know, before their payment was calculated.
[00:17:56] Speaker B: They were a resident or in training somewhere. Well, they may be paying $0 getting credit on income driven repayment plans, but because their credit report says a zero.
[00:18:05] Speaker A: Dollar payment, the lender is going to.
[00:18:07] Speaker B: Take 0.5% of the balance instead on $100,000 loan.
[00:18:12] Speaker A: That means that they will be using a dollar 500 monthly payment to calculate debt to income ratio. Odd as it may seem, this may.
[00:18:20] Speaker B: Be a scenario where if you find yourself in this situation, you call your student loan servicer and ask them to recalculate your payment so that it shows a balance. Because if you do that in this.
[00:18:32] Speaker A: Example, and what you have to pay.
[00:18:34] Speaker B: Based on your current income is less.
[00:18:36] Speaker A: Than $500 a month, actually having a.
[00:18:39] Speaker B: Payment that's put on your credit report will save you from them using 0.5% of your balance instead.
[00:18:46] Speaker A: An FHA loan, monthly student loan payment.
[00:18:48] Speaker B: Listed credit report, student loan statement, so on, so forth.
[00:18:52] Speaker A: It also, if the monthly payment is.
[00:18:54] Speaker B: Reported as zero, will use 0.5% of the balance. But where you see a change is with a VA loan. So if you're a military veteran or currently in the military with the VA loan, the monthly student loan payment as listed on the credit report, or 5%.
[00:19:10] Speaker A: Of your balance divided by twelve months, whichever is higher. So let's go through this scenario. Let's say that we have a person who's a military veteran who is paying $100 a month on their $100,000 student loan. Well, this VA lender is going to.
[00:19:28] Speaker B: Look and they're going to see the month and they're going to say, okay, that's what's listed on their credit report.
[00:19:34] Speaker A: But then they're going to look at.
[00:19:35] Speaker B: The student loan balance of $100,000.
[00:19:37] Speaker A: They're going to take 5% of that.
[00:19:40] Speaker B: Which is $5,000, and they're going to.
[00:19:43] Speaker A: Divide it by twelve. I'll do some quick phone calculator math. $5,000 divided by twelve is basically $417 a month. So in this scenario, even though the.
[00:19:54] Speaker B: Person is paying $100 a month, because.
[00:19:56] Speaker A: 5% of that balance divided by twelve.
[00:19:58] Speaker B: Is higher, the VA lender is going to use 417 as the payment, in.
[00:20:04] Speaker A: Spite of them actually paying 100.
[00:20:06] Speaker B: If the loan is deferred, however, they.
[00:20:09] Speaker A: Don'T include it in the calculation at all.
[00:20:10] Speaker B: So this is very different from the.
[00:20:12] Speaker A: Other lenders who kind of penalize you.
[00:20:14] Speaker B: For being in deferred with a VA loan.
[00:20:16] Speaker A: You actually get a benefit by them.
[00:20:18] Speaker B: Acting as if the loan doesn't exist when it comes to mortgage calculation of debt to income.
[00:20:24] Speaker A: And lastly, a USDA loan, you see the monthly student loan payment listed on.
[00:20:28] Speaker B: The credit report of the student loan payment. Or if the payment is zero, they also use 0.5% of the balance. Now, these are federally backed loans, but it's also important to understand that you.
[00:20:41] Speaker A: Could be getting a loan with a.
[00:20:43] Speaker B: Private lender that's not federally backed.
[00:20:45] Speaker A: And if that's the situation, it's going.
[00:20:47] Speaker B: To be dependent on that lender.
[00:20:49] Speaker A: And you can't just have this standard, oh, this is how they calculate it.
[00:20:52] Speaker B: You have to actually communicate with your.
[00:20:54] Speaker A: Lender, tell them you have student loans.
[00:20:57] Speaker B: Ask for the guidelines of how they.
[00:20:59] Speaker A: Calculate it, and based on how they calculate it, that might be something that.
[00:21:03] Speaker B: Pushes you to another loan.
[00:21:05] Speaker A: When you get into the private marketplace and they're not federally backed loans, there's.
[00:21:08] Speaker B: Dozens of different loan products out there. And based on how each of them.
[00:21:13] Speaker A: View your student loan payment, you could.
[00:21:15] Speaker B: Have a decision on your hands that either puts you in a better light or a worse light. But the important part is that you understand the impact and ask the questions.
[00:21:24] Speaker A: So you get the answers that you need to know. So I know this is a lot of information.
We probably will continue to kind of.
[00:21:30] Speaker B: Pull on this thread for people who.
[00:21:32] Speaker A: Are trying to buy a home or get another home while also having student loan debt, but hopefully you realize that this is possible.
[00:21:39] Speaker B: You just have to be aware of.
[00:21:40] Speaker A: The impact on your credit, your debt.
[00:21:42] Speaker B: To income ratio, and how your lender uses your loan when calculating your debt to income ratio.
[00:21:48] Speaker A: I'll see you guys in two weeks.
[00:21:51] Speaker C: From escape student loan debt this was the escape Student Loan Debt podcast, a show for established professionals whose student loan.
[00:21:58] Speaker B: Payments or loan balances are impacting their marriage, their business, their credit, or their dream of achieving homeownership.
