You’re fresh out of college and ready to take on the world. First step, get a job. Second step, get a house. But wait, you look at your student loans and you have almost $130,000 weighing above your head and at any moment, specifically six months, it will drop upon you and you’re stuck paying it for at least ten years. So, how can you get approved for a mortgage while paying your student debts?

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Set up your loan payments

During your six-month grace period it’s important to set up your loan payments. A nice trick that most post-grads are not aware of are income-driven payments. Sallie Mae takes a look at last year’s taxes and your current salary and bases your payments off of that. In some cases, your payments could be so low that it would not have that big of an impact on your qualifications for a mortgage.

Get a Co-Borrower

If your parents agree, have them cosign. This makes you look like a more attractive borrower with a backup plan. Plus, their income is included and therefore your debt to income will be much lower.

FHA Loan Program

FHA Loans

The FHA loan program has more lenient guidelines than conventional loans. When saddled with student loan debt and other bills the FHA loan program may be your best bet. Although FHA comes with PMI, it has a lower interest payment than conventional loans making it still affordable! Plus, you can eventually refinance and get rid of your PMI.

Coastlend’s 3% Down, No PMI Loan Program

Coastlend Mortgage offers a loan program where first time home buyers can put as low as 3% down and not pay the dreaded mortgage insurance. A small down payment opens up the door to home ownership for many 1st time buyers. Moreover, your payments will be much lower without PMI.

You may be saddled with debt and feel like you’re unable to purchase a home- but that is the farthest thing from the truth. There are a variety of options that will allow you to take the step to being a home owner. To see what your options are apply here or give us a call at 843-388-5763.