Do I consider my SL debt?

[Anonymous]

Im reposting a question that got lost in the other thread.

When trying to determine how much mortgage I can afford for the debt to income ratio. Would I include my student loan debt that is in deferment? I'm still half time and it will be in deferment for at least 2 more years. So it's a debt I'm not making payments on right now.

[Anonymous]

I would because you will still be paying the house two years from now. Is this a serious question? (not trying to be mean)

[Anonymous]

If payments aren't due now I don't think a lender would include it in the ratio but you definitely should when you're determining how much you can afford. You're going to have to start paying on it during the time that you have the mortgage so include it when you're figuring out how much you want to buy.

[Anonymous]

Student loan debt is included.

[Anonymous]

OP here. Thanks for the replies.

My thinking is that once I graduate, I will be able to get a higher earning job so while the monthly expenses go up, I'm planning for the income to as well. Of course nothing's guaranteed, though.

[Anonymous]

Anonymous wrote:OP here. Thanks for the replies.

My thinking is that once I graduate, I will be able to get a higher earning job so while the monthly expenses go up, I'm planning for the income to as well. Of course nothing's guaranteed, though.

Be careful about doing that. You may not make any more after you earn your degree.

[Anonymous]

today, the debt is there, the higher earning is not. plan accordingly

[Anonymous]

warning about student debt: I had 90k student debt when I graduated with an MBA 10 years ago. My salary went frm 40k to 85k, so I felt "rich". I was single and no house, etc., so it seemed like a fortune, but my MINIMUM payment for a 30 yr payoff was $800/month. I had to double it to $1700/month to get out from under the private portion of the debt in 5 years. I now "only" have 30k left but at a low interest rate (2%), so the payment is only $200. If I had a house payment, daycare, etc. I would have been in worse shape.

In short, your salary will go up, but have you calculated how much your monthly payment of debt is likely to be? This is essential. Definitely include it, and if you're thinking of having kids, a daycare payment of $1000k minimum per kid is a good one to factor in that they don't include as a requirement when calculating what you can afford for a mortgage.

[Anonymous]

yes, you student loan debt is figured into the calculation of how much home you can afford.....all long-term debt is included!

fyi, consolidate now if you haven't while IR are at historic lows. good luck.

[Anonymous]

Anonymous wrote:yes, you student loan debt is figured into the calculation of how much home you can afford.....all long-term debt is included!

fyi, consolidate now if you haven't while IR are at historic lows. good luck.

Isn't it impossible to consolidate federal student loans?

[Anonymous]

Anonymous wrote:

Anonymous wrote:yes, you student loan debt is figured into the calculation of how much home you can afford.....all long-term debt is included!

fyi, consolidate now if you haven't while IR are at historic lows. good luck.

Isn't it impossible to consolidate federal student loans?

Answer: While you can "consolidate" federal loans, it would be at the same interest rate(s) you currently have.

[Anonymous]

Anonymous wrote:warning about student debt: I had 90k student debt when I graduated with an MBA 10 years ago. My salary went frm 40k to 85k, so I felt "rich". I was single and no house, etc., so it seemed like a fortune, but my MINIMUM payment for a 30 yr payoff was $800/month. I had to double it to $1700/month to get out from under the private portion of the debt in 5 years. I now "only" have 30k left but at a low interest rate (2%), so the payment is only $200. If I had a house payment, daycare, etc. I would have been in worse shape.

In short, your salary will go up, but have you calculated how much your monthly payment of debt is likely to be? This is essential. Definitely include it, and if you're thinking of having kids, a daycare payment of $1000k minimum per kid is a good one to factor in that they don't include as a requirement when calculating what you can afford for a mortgage.

Yes, the other thing people often don't consider is the taxes go up too with your income. And the compounding interest.