# Getting Your First Mortgage When You Have Student Loans Just Got Easier

If student loan debt has delayed your dreams of owning a home, a recent change could make it easier to qualify for an FHA home loan.

The Federal Housing Administration updated how it requires lenders to calculate student loan debt with FHA loans. The aim is to remove student debt as a barrier to entry for getting an FHA home loan — the FHA says more than 45% of first-time borrowers have student loan debt and the previous guidelines negatively impacted people of color in particular.

The change has the potential to increase access to FHA-backed mortgages for underserved communities and those who have student debt — and some previously ineligible borrowers could now be eligible under the change. The people who benefit the most are highly indebted borrowers with lower incomes, says Catalina Kaiyoorawongs, co-founder of the student debt financial wellness platform LoanSense.

Here’s what this change means for you:

## Getting an FHA Loan Just Got Easier

For loans not in active repayment (forbearance, deferment, income-based repayment plan), the guidelines previously required FHA mortgage lenders to calculate a borrower’s monthly student loan payment using 1% of the total loan balance. This amount was then factored into their debt-to-income (DTI) ratio, negatively impacting borrowing potential.