FHA Update: Student Loan Debt Policy
Plaza Home Mortgage® is aligning with FHA student loan guidance as announced in the Mortgagee Letter 2021-13. The updated policy removes the current requirement that lenders calculate a borrower’s student loan monthly payment as 1% of the outstanding student loan balance for student loans that are not fully amortizing, or are not in repayment.
The new policy bases the monthly payment on the actual student loan payment, which is often lower, and helps home buyers with student debt meet minimum eligibility requirements for an FHA-insured mortgage.
This updated policy may be employed by lenders immediately but mandatory implementation is required for all case numbers assigned on or after August 16, 2021. Plaza will apply this policy immediately.
If you have questions on the updated FHA student loan debt policy please contact your Plaza Account Executive, or email us at hereforyou@plazahomemortgage.com.