If you’re carrying student loan debt and dreaming of owning a home, you’re not alone—and you’re certainly not out of luck.
One of the biggest myths I hear from first-time buyers is that student loans automatically disqualify them from getting a mortgage.
The truth is, buying a home with student loan debt is absolutely possible. In fact, I’ve helped many clients just like you navigate the process successfully.
With the right plan, a little guidance, and a mortgage coach in your corner, you can turn the dream of homeownership into a reality—even with those loan balances hanging around.
How Does Debt Impact Eligibility?
Let’s start by addressing the elephant in the room: student debt does impact your mortgage eligibility—but not always in the way people assume.
Lenders don’t just look at your loan balance; they’re far more focused on your monthly payments and how they fit into your overall debt-to-income ratio (DTI).
This ratio is simply a calculation that compares your monthly debts (including student loans, car loans, credit cards, and your future mortgage payment) to your monthly income.
Most loan programs have DTI limits, but if your payments are manageable and you’ve got steady income, qualifying is often well within reach.
Student Loans in Deferment
Now here’s where it gets interesting: even if your student loans are in deferment or income-based repayment (IBR), there are options.
For example, FHA loans use a standardized 0.5% of the loan balance if there’s no payment reported—or they’ll use the actual IBR payment if it’s fully documented.
Conventional loans through Fannie Mae or Freddie Mac often allow you to qualify using the lower actual IBR payment, which can make a huge difference. Each loan program treats student loans a bit differently, and knowing how to match the right loan to your financial profile is key.
That’s where smart mortgage coaching really comes into play.
Credit Score and Financial Health
Aside from loan program guidelines, your credit score and overall financial health also matter. The good news?
Making consistent student loan payments over time can actually help your credit score. If your credit needs some TLC, don’t worry—that’s something I help clients with regularly.
Sometimes just a few small tweaks can raise your score enough to improve your rate or open up better loan options. We can review your credit report together and come up with a strategy that puts you in a stronger position.
Other Options
Another way to improve your chances is to lower other monthly debts or increase your income—two things that can quickly shift your DTI in the right direction. This could mean paying off a small car loan or credit card, picking up a side hustle, or even getting a co-borrower involved if it makes sense.
Remember, every situation is unique, and that’s why working with someone who takes the time to understand your goals makes all the difference.
Don’t Do It By Yourself – Get Expert Advice
One thing I always stress with my clients is this: don’t try to “figure it all out” on your own. The mortgage process can feel overwhelming, especially when student loans are part of the picture—but it doesn’t have to be.
My job as The Lending Coach is to break things down clearly, help you understand your options, and walk you through a plan that fits your life and your timeline. There’s no pressure—just clarity, strategy, and support.
So, if you’ve been holding off on buying a home because of your student loans, now is the time to take a fresh look. You might be closer to qualifying than you think.
You can connect with me here – so we can review your full financial picture and create a custom plan to move you forward. You absolutely can build wealth through real estate—and student debt doesn’t have to hold you back.
The blog postings on this site represent the positions, strategies or opinions of the author and do not necessarily represent the positions, strategies or opinions of Guild Mortgage Company or its affiliates. Each loan is subject to underwriter final approval. All information, loan programs, interest rates, terms and conditions are subject to change without notice. Always consult an accountant or tax advisor for full eligibility requirements on tax deductions.
