All Forum Posts by: John Acheson

Olivia, I can offer a few helpful tips on this based on recent research and rule changes.  The 1st would be to build credit by utilizing 2-10% (sweet spot) of available credit on your cards for a few to several months (to maximize your score) but two months before you apply for a mortgage pay all debt to $0.

The 2nd larger issue is the student loan and the 1st step would be to get copies of your tax returns ready and fill out the paperwork to get on the lowest payment plan i.e. Income Based Repayment, Income Driven, etc.  After a month or two, check your credit for free at CreditKarma and when the lower payments show up on your credit report, get ready to apply for your mortgage.

The 3rd step is to choose a bank or lender that is Fannie Mae backed because they recently changed the student loan rules to be able to use the lower payments shown on your credit reports as opposed to FHA's 1% rule or brokers that say they have to amortize your loan to calculate DTI.

With the lowest possible debt combined with Fannie Mae, at least for now in mid-2018 until the rules change, you should have the best chance at a DTI that can get you into a property. GOOD LUCK!

If anyone hears of any other financing that will accept the lower student loan payments in calculating DTI, let us know