Student loan debt does not have to prevent you from buying a home. Millions of Americans with student debt successfully purchase homes every year.
Understanding DTI
Lenders care about debt-to-income ratio. Most want DTI of 43% or less including proposed mortgage. If on income-driven repayment, lenders may use actual payment rather than standard amount.
Strategies to Improve
Pay down other debts to improve DTI. Build larger down payment to eliminate PMI. Explore FHA loans which accept DTI up to 50%.
Special Programs
Several programs help buyers with student debt. FHA loans have lenient DTI requirements. VA loans have no maximum DTI. Some states offer down payment assistance for first-time buyers.