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Julietkearsch, Home Buyer in

If my student loan is in default can i qualify for a mortgage?

Asked by Julietkearsch, Wed Jul 11, 2012

I owe about $4000 in student loans i have s Co signer but will this prevent me from being approved

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@Steve it scares me that someone can be in default on a loan and still get a loan to purchase property. By the way if Julie had 30% to put down on a property I would think that the prudent thing to do would be to pay off the 4000.00 that is currently showing as bad debt and avoid having a lein attach to her new property.
1 vote Thank Flag Link Thu Jul 12, 2012
Not a problem. Very easy!

My realtor partners who offer my buyers Realtor Rebates can pay off the student loan at closing.

Example:

300k purchase

9,000 real esate commission to any buyer's agent

$5,000 credit to Mortgage Broker's pre approved buyer referral to pay off Student Loan

$4,000 buyer's agent keep = to selling a $133,000 property

See how it works here:

http://www.trulia.com/blog/steve_31/2012/07/500_000_purchase…

http://www.trulia.com/blog/steve_31/2012/05/why_why_would_a_…

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0 votes Thank Flag Link Thu Jul 12, 2012
Yes, it is a very big problem and it will only get worse with time. Most student loans are federal loans, and the Feds are fairly particular about extending more credit to someone that is already not paying them. No DE underwriter is going to approve a mortgage if you can’t make a small payment like a student loan. You’ll need to get current or pay it off in full and stay clean for at least 12 months. Good luck,

Jim Simms
NMLS # 6395
JSimms@cmcloans.com
Financing Kentucky One Home at a Time
0 votes Thank Flag Link Thu Jul 12, 2012
Julie, you need to talk to a credit counselor. Find someone with the National Foundation for Credit Counseling. If you only owe $4000, you should be able to wipe up the debt in just a year or two.

Student debt is the most important to pay - it cannot be reduced or eliminated through bankruptcy.

If your budget doesn't stretch far enough to pay off $4000.... you're probably not a good candidate to buy a house anyway. You won't have the funds available to pay for repairs when (not if, but when) things break down.

Ann
Web Reference: http://www.nfcc.org/
0 votes Thank Flag Link Thu Jul 12, 2012
Yes, with 30% down, borrowers in this situation can get a loan

se programs at: http://www.pro-option.com
0 votes Thank Flag Link Thu Jul 12, 2012
Typically any active unpaid/delinquent debts must be current. I'd recommend that you contact a local mortgage broker who can best guide you.
0 votes Thank Flag Link Wed Jul 11, 2012
I would safely say that this will be major red flag when you are trying to get preapproved.
0 votes Thank Flag Link Wed Jul 11, 2012
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