Can You Get a Mortgage With Student Loans? What Lenders Really Look For

Student loans don't disqualify you from getting a mortgage, but how your lender calculates your qualifying payment can vary significantly by loan program. Comparing programs like Fannie Mae, FHA, and VA loans, and getting pre-approved early, can make the difference between approval and denial.

As of June 30, 2026, about 42.3 million recipients owed more than $1.7 trillion in federal student loans, according to Federal Student Aid. For many of them, that's a recurring monthly bill that makes saving for a home difficult. Meanwhile, the median first-time buyer is now 40, a record high, according to NAR's 2025 Profile of Home Buyers and Sellers.

So, can you get a mortgage if you have student loans? Let's break down what matters so you can understand how student loans affect your mortgage eligibility and options.

Federal student loan repayment also changed in 2026. A court order ended the Saving on a Valuable Education (SAVE) plan in March 2026. Former SAVE borrowers are now being moved into other plans, according to Federal Student Aid's SAVE Plan FAQs.

The new Repayment Assistance Plan (RAP), an income-driven repayment (IDR) plan launched July 1, 2026, has a $10 minimum monthly payment. That means the monthly payment a lender sees may be changing. Get your current figure from your servicer before you apply.

Yes, it's possible to have student loans and a mortgage approval. Student debt won't disqualify you, but it affects how much home you can afford and which loan programs work best for you.

Many borrowers wrongly believe that mortgage lenders heavily weigh remaining student loan balances in loan approval decisions.

For example, Schuiteboer had an applicant with $90,000 in student loan debt who had assumed homeownership was out of reach, but their qualifying loan payment ranged from $0 to $450, depending on the loan program they chose.

Your qualifying payment is the monthly student loan amount your mortgage lender uses to calculate your debt-to-income (DTI) ratio. Your DTI is expressed as a percentage and shows how much of your gross monthly income goes to debt payments. Lenders use it to decide whether you can comfortably handle the mortgage bill.

Your qualifying payment can differ from what appears on your credit report because each mortgage program has its own rules, and the lender's calculation takes precedence over what's shown on the credit report.

Here's a hypothetical illustration, not a statistic. Say you earn $6,000 a month before taxes, your proposed housing payment is $1,500 and you pay $300 a month on other debts. You also have $60,000 in deferred student loans.

Your income and debts stay the same, yet your DTI jumps 5 points based only on which payment the lender uses. That gap can be the difference between fitting under a program's limit and going over it.

Lenders also look at two versions of DTI. Front-end DTI counts only your housing payment, while back-end DTI adds your other monthly debts. To see where your numbers land, read how your debt-to-income ratio affects your mortgage.

Can Your DTI Ratio Vary by Loan Program?

Yes, and the difference can decide whether you get approved or denied. Each program sets its own DTI limits, and there's sometimes flexibility if you have strong credit or savings.

Sources: Fannie Mae Selling Guide B3-6-02, Debt-to-Income Ratios; HUD Single Family Housing Policy Handbook 4000.1.

One of Schuiteboer's clients was turned down for an FHA loan because his DTI was 47%, but was approved for a Fannie Mae conventional loan after the program determined his DTI to be 39%.

The borrower's income was the same in both applications. The difference came down to Fannie Mae's willingness to use a $0 IDR payment, which FHA wouldn't accept.

If you're in deferment or forbearance or on an income-driven repayment (IDR) plan, the qualifying payment used in your DTI will depend on the mortgage program. Under Fannie Mae's rules for monthly debt obligations, a documented $0 IDR payment may count as $0. For deferred loans or loans in forbearance, Fannie Mae uses 1% of the balance or a fully amortizing payment.

Freddie Mac, FHA's student loan payment rules and USDA's ratio analysis rules use 0.5% of the balance when your reported payment is $0. VA's credit underwriting rules use 5% of the balance divided by 12. The program table below breaks down each rule.

Schuiteboer says lenders will want to see the following documents to ensure they use accurate data:

1. All borrowers: A recent statement from your loan servicer showing your actual monthly payment.

2. IDR borrowers: Your most recent approval or recertification letter, which verifies your plan type and payment amount.

3. Borrowers in deferment or forbearance: Paperwork from your servicer showing the terms, expiration date, and current balance.

4. Borrowers close to full or partial forgiveness: Evidence of qualifying payments leading toward forgiveness.

Are you close to forgiveness? Freddie Mac's Guide Section 5401.2 lets lenders exclude a student loan with 10 or fewer payments left until forgiveness or discharge, if you document eligibility.

Fannie Mae's general rule lets lenders exclude debts with 10 or fewer payments left, unless the payment significantly affects your ability to pay.

How Do RAP and the End of SAVE Change Your Qualifying Payment?

Because RAP has a $10 minimum payment, RAP borrowers will show a payment above $0. That limits the "$0 IDR payment" advantage to borrowers still on plans like income-based repayment (IBR).

Here's what changed, according to the Federal Student Aid SAVE Plan FAQs linked above and its income-driven repayment plans page:

• SAVE ended by court order in March 2026.

• Servicers began notifying SAVE borrowers on July 1, 2026, with a 90-day window to choose a new plan.

• Borrowers who don't choose a plan are placed in a standard repayment plan.

• RAP payments are 1% to 10% of your adjusted gross income (AGI), minus $50 per dependent, with a $10 minimum.

• IBR stays available for loans disbursed before July 1, 2026.

• Income-contingent repayment (ICR) and Pay As You Earn (PAYE) end no later than July 1, 2028.

After any plan change, get a new servicer statement or approval letter showing your new payment before you apply. Otherwise, a lender may use your credit report figure or a 0.5% or 1% placeholder.

As of October 2026, the agency guides BestMoney reviewed don't include RAP-specific guidance. Ask your lender how it will count a RAP payment.

Missed student loan payments can lower your credit score. A federal student loan in default can also stand in the way of a government-backed mortgage until you resolve it. Late payments are becoming more common, too.

About 1 in 10 dollars of student debt was 90 or more days past due in the second quarter of 2026. That's 10.6% of balances, up from 10.3% in the first quarter, according to the New York Fed's Quarterly Report on Household Debt and Credit. Federal Student Aid's September 2026 report, cited above, counted more than 9.3 million federal loan recipients in default.

HUD's Single Family FHA INFO page notes that federal law bars FHA-insured mortgages for people with delinquent federal non-tax debt. A defaulted federal student loan generally falls into that category. Ask your lender how your loan status affects other programs.

Getting out of default is the path back. Federal Student Aid's guide to getting out of default covers two main options: loan rehabilitation or loan consolidation. Rehabilitation takes nine monthly payments and removes the default record.

Each mortgage program counts student loan payments by its own rule, so the right fit depends on your repayment plan, credit, and balance. FHA loans, which can work for lower credit scores, are a common starting point to research. BestMoney reviewed each agency's current underwriting guide (as of October 2026) to compare how they count student loan payments.

Sources (linked above): Fannie Mae Selling Guide B3-6-05, Freddie Mac Guide Section 5401.2 and HUD FHA guidance. VA Pamphlet 26-7 Chapter 4 and USDA HB-1-3555 Chapter 11 cover the VA and USDA rows.

Lenders can apply stricter rules (overlays) than these agency minimums, so confirm with each lender. FHA's credit score methodology is set to change for case numbers assigned on or after Jan. 1, 2027, under HUD Mortgagee Letter 2026-11, but the 580 and 500 score cutoffs stay the same.

There are plenty of steps you can take to increase your chances of being approved for a mortgage. One of the most overlooked strategies is to speak with a mortgage professional early, rather than waiting until you think you are 'ready,' says Bill Egan, senior mortgage loan officer and co-founder of Babcock Mortgage.

He sees some buyers qualify sooner by switching to an IDR plan, paying off small debts to lower their DTI, using down payment assistance, adding a co-borrower, or correcting errors on their credit reports.

For most borrowers, switching to an income-driven plan now means RAP, or IBR for loans taken out before July 1, 2026. That can still lower your monthly payment, but RAP won't go below $10.

Another underused move is to explore state housing programs for first-time homebuyers. "Nearly every state offers support for student loan borrowers, such as Ohio's 'Grants for Grads,' which helps cover down payments and closing costs," says Schuiteboer. First-time homebuyers should spend some time comparing mortgage lenders to see who can get them the best terms.

Should You Pay Off Student Loans Before Buying a House?

Not necessarily. Lenders look at your qualifying payment and DTI, not whether your balance is zero.

A $100,000 or $200,000 balance isn't disqualifying on its own, as the $90,000 example above shows. A bigger balance does mean a bigger placeholder payment if your reported payment is $0.

Paying down debt first can make sense if your DTI is above program limits or your down payment savings are thin. Before you put your plans on hold, check the state housing programs for first-time homebuyers covered above.

This guide is for anyone with student loans who wants to know how lenders will count those loans before applying for a mortgage.

• On a $0 IBR payment: A Fannie Mae conventional loan may let you qualify with a $0 payment if it's documented.

• Former SAVE borrower: Choose a new plan and get updated payment paperwork before you apply.

• Loans in deferment or forbearance: Expect a 0.5% or 1% placeholder unless VA's 12-month deferment exclusion applies.

• Veteran or service member: Compare your payment against VA's rule of 5% of the balance divided by 12. See how a VA loan works.

• Buying in a rural area: USDA uses 0.5% of the balance when your reported payment is $0.

• Behind on payments or in default: Work on resolving the default before you apply, especially for an FHA loan.

Can you get a mortgage with student loans? It's possible, but you may need to adjust your homebuying strategy depending on your qualifying payment, mortgage program, and available student loan documentation.

"Don't rely solely on your credit report or general assumptions about student loan debts, and get pre-approved before you decide on buying," Schuiteboer advises. He stresses getting pre-approved first because rules vary state to state and program to program, and not every loan officer is up to date on the latest student loan underwriting criteria.

The more you understand about how your loans are viewed, the better positioned you'll be to find a program that works in your favor.

Start by confirming the exact payment a lender will see. Then work through these steps:

1. Download a current servicer statement and your IDR or RAP approval letter.

2. Pick a new repayment plan before your servicer's deadline if you were on SAVE.

3. Run your DTI using the worked example above.

4. Get pre-approved and compare offers from several lenders, since overlays vary.

5. Check your state's down payment assistance programs.

For every step of the homebuying process, use our first-time home buyer checklist.

Can you buy a house with $100,000 in student loans?

Yes. Lenders focus on your qualifying monthly payment and DTI rather than your balance, so your loan program's payment rule matters most.

How do mortgage lenders count student loans in deferment?

Most use a placeholder: 0.5% of the balance for Freddie Mac, FHA and USDA loans, or 1% for Fannie Mae. VA may exclude loans deferred at least 12 months past closing.

Does a $0 income-driven payment count as $0 for a mortgage?

Among the five programs covered here, only Fannie Mae lets a documented $0 IDR payment count as $0. RAP payments can't go below $10, so RAP borrowers won't have a $0 payment to document.

Can you get a mortgage if your student loans are in default?

It's harder, because defaulted federal student loans generally must be resolved before you can get an FHA loan. Rehabilitation or consolidation is the usual first step.

What debt-to-income ratio do you need for a mortgage?

It depends on the program: Fannie Mae allows 36% to 45% on manually underwritten loans and up to 50% through automated underwriting. FHA manual underwriting starts at a 43% total DTI and can reach 50% with compensating factors.

BestMoney's editorial team reviewed the current mortgage underwriting guides as of October 2026. These include Fannie Mae Selling Guide B3-6-02 and B3-6-05, Freddie Mac Guide Section 5401.2, and HUD Handbook 4000.1 and FHA guidance. The review also covered VA Pamphlet 26-7 Chapter 4 and USDA HB-1-3555 Chapter 11.

We also read Federal Student Aid's repayment plan guidance and data from Federal Student Aid, the New York Fed and NAR. The article includes interviews with two mortgage professionals.

This article relies on these secondary sources and expert interviews. BestMoney didn't use a proprietary survey for it.

• Federal Student Aid, "Federal Student Aid Posts Updated Reports to FSA Data Center" (Sept. 22, 2026)

• Federal Student Aid, "SAVE Plan Borrowers: FAQs" (October 2026)

• Federal Student Aid, "Income-Driven Repayment Plans"

• Federal Student Aid, "Getting Out of Default"

• Federal Reserve Bank of New York, "Quarterly Report on Household Debt and Credit, 2026:Q2" (August 2026)

• National Association of Realtors, 2025 Profile of Home Buyers and Sellers press release (Nov. 4, 2025)

• Fannie Mae Selling Guide, B3-6-02 "Debt-to-Income Ratios" and B3-6-05 "Monthly Debt Obligations"

• Freddie Mac Single-Family Seller/Servicer Guide, Section 5401.2

• HUD, "How does a Mortgagee determine the monthly payment on a student loan?" (FHA Answers)

• HUD, Single Family Housing Policy Handbook 4000.1

• HUD, Mortgagee Letter 2026-11 (Oct. 8, 2026)

• HUD, Single Family FHA INFO (May 2026)

• U.S. Department of Veterans Affairs, VA Pamphlet 26-7, Chapter 4, "Credit Underwriting"

• U.S. Department of Agriculture, HB-1-3555, Chapter 11, "Ratio Analysis"

• Ohio Housing Finance Agency, "Grants for Grads"

• Interviews with Cody Schuiteboer (Best Interest Financial) and Bill Egan (Babcock Mortgage)