Student Loan Debt & the Hurdle To Purchase A Home
If you’re like the many post-university students in America, then you understand the burden that comes with holding and carrying your student debt.
For wanna-be-homeowners with student debt, the situation can come even harder. Many loans are weary of your debt-to-income ratio, thus, making it harder for you to obtain the financial assistance you need to purchase a home and become a homeowner.
Luckily, it looks like eases of requirements are changing.
Last summer, the National Association of Realtors® joined a team of roughly 20 housing groups in calling on leadership at the Department of Housing and Urban Development and the FHA to help change underwriting policies that calculate a borrower’s student loan debt.
Specifically – the aim was to close the gap between White and Black Americans when obtaining a mortgage loan. According to NAR, the gap between the two is larger today than it was in 1960, and Black homebuyers are more than twice as likely than Whites to have student loan debt and be rejected for mortgage loans.
The meeting ended up launching the Black Homeownership Collaborative. This group will continue to push for policy reforms and work with the FHA’s student loan change. These updates in policy will remove “unnecessary constraints for otherwise creditworthy borrowers” in helping to aid first-time homebuyers and underserved communities.
Student loans – and your race – shouldn’t prevent you from becoming a homeowner and fulfilling your real estate dreams.
For more updates on the policy change, check out the U.S. Department of Housing and Urban Development’s site here.