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I'm a physician and I have high student loans on the REPAYE program and a high income (hopefully it will grow in the next few years). I own my car, I have some credit card debt, but is below 30% and it is going down.
I'm currently renting an apartment and when I calculate my current DTI it is 9% on the front-end and 20% on the back-end.
So the DTI looks good from the perspective of what I need to pay per month for my student loans with the income-based repayment, but not great at all from the perspective of total student loans.
Will a mortgage company look at just my monthly student loan obligation?
They should look at your monthly obligation - doesn’t hurt to ask a mortgage broker though - they would be able to tell you without running your credit.
They will look at everything you are making payments on with the exception of loans on which you have less than ten payments left. Also, they will calculate based on the mortgage amount, not what you are paying in rent at the time you apply. You will be fine. In most cities, it is cheaper to buy than rent, so your DTI would probably be less, not more. Besides, 9% and 20% are quite good.
I'm a physician and I have high student loans on the REPAYE program and a high income (hopefully it will grow in the next few years). I own my car, I have some credit card debt, but is below 30% and it is going down.
I'm currently renting an apartment and when I calculate my current DTI it is 9% on the front-end and 20% on the back-end. Your method of calculation needs to be illustrated in order to provide accurate feedback.
So the DTI looks good from the perspective of what I need to pay per month for my student loans with the income-based repayment, but not great at all from the perspective of total student loans. Income-based payments are not allowed. Depending on loan type, the lender will use either .5% of the loan balance, 1% of the loan balance, or the full non-income-based payment, for the monthly payment.
Will a mortgage company look at just my monthly student loan obligation?
Having said that, there are Doctor-specific loan programs that take a more realistic approach to underwriting so it will be important for you to seek these out.
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