student loan deferment and mortgage? (payment schedule, approved, credit card, mortgage rates)

[Ignatz]

My husband and I own a house, but want to move. Our mortgage terms now are good, and we pay everything timely. ( His credit is great. Mine's medium to good.) His job pays well. However, I got laid off and now receive unemployments; I deferred payment on my student loans because of unemployment.
If we buy another house, we're worried that this deferment will negatively affect my credit rating and whatever else lenders look at when they set mortgage rates.
Does anyone have any experience/insight re this?
Thanks.

[Humanoid]

As far as I know a deferment does not negatively effect your credit rating, they report it as "paid as agreed".

The lender is going to look at your debt to income ratio, and if they see that your loan is being deferred they'd be pretty stupid to give you a mortgage since that implies you cannot currently pay your bills. Also, they certainly aren't going to consider unemployment as income, so your husband's income alone would have to qualify you for the loan.

The days of lax lending standards are over, from what you said your application would raise all sorts of red flags.

[TimtheGuy]

You can use your only husband's income and only your husband's credit to qualify. Your credit, deferred payment and unemployment will not come into play in any fashion.

There will be no red flags whatsoever! Humanoid does not know what the lending standards are.

[renriq02]

Actually, deferred student loans will not to be proven.

Most lenders have a guideline that will require you to show how long it is deferred for...and if it's less than 24months then they will hit you with the student debt. Depending on your credit score...they will adjust the payment by 1,2,3,4, or 5% or the balance. Every lender is different, and they have different payment scales for credit score.
The way to avoid this is to show your guaranteed payment schedule.

Either way....if you're not back in school...they will most likely hit you with the student debt as it is only deferred due to you being unemployed.

[Humanoid]

Your credit, deferred payment and unemployment will not come into play in any fashion.

The deferred payment will come into play, because its a debt. Also, why are they deferring the debt in the first place? Just for fun? No because they can't afford the payment....so how would they qualify for a mortgage under standard underwriting conditions?

There will be no red flags whatsoever! Humanoid does not know what the lending standards are.

I didn't know there was one set of "lending standards". This would raise a red flag for many loan consultants.

[ChipL]

what he was saying was for the poster to use only the husband on the loan and then the poster's student loan, unemployment, and all would not come into play.

[Humanoid]

and all would not come into play.

They are married the wife's debts come into play.

[renriq02]

Please tell us which lender you are looking at?

I work with over 400 lenders...and I have been in the business quite a while.
I have never seen a lender require the spouse's debts...because they're 'married'. The only time it's require is if the spouse is on the mortgage application. The spouse can be on title...but doesnt have to be on the mortgage.

Maybe this is a new guideline that we're not aware of...can you please tell us where you retrieved this information. It will benefit us all to know that we're following the correct procedures.

Originally Posted by Humanoid

They are married the wife's debts come into play.

[Briolat21]

Right on Banker0679!!

I know this is true - because when we started looking at houses, I took my information and my husbands to the local mortgage brokers/lenders. After evaluating it, they said - apply by yourself, your husband hurts you more than helps you.

As such, I will be the sole responsible party on the mortgage. My husband (who's debts we are in the process of cleaning up, but who has had negative judgments against him in the past which are just sitting there making him look bad) may be on the title - we haven't decided yet, because we're half afraid if we put him on the title a debtor will come out of the wood work to move against his "assets". I think we've tracked them all down and satisfied them all, but, not confident on that.

Anyway -- as I was the sole applicant, they are not looking at any of my husband's finances - not his debts, not his income, nothing. So I have been approved strictly on my own finance strength. Which is good, because then we can use his income to help with utilities/food/gas/savings/etc..

So unless the spouse is a joint applicant for the mortgage itself - the banks should not be looking at their data.

[Karla with a K]

Briolat21
I agree if there is any chance that there are outstanding judgments against your husband I would not put him on the title.
When I was with the credit card company they started a team whose only job was to look at the judgment accounts to see if they had acquired any assets they could attach. Their main focus were judgments that were 4+ years old because thats about the time frame that folks think "hmmm they must of forgotten about me"