Many first-time homebuyers especially, are wondering what impact their student loan debt has on their plans.
Is it possible to qualify with this debt? Do loans have to be paid off before buying a home?
The following is what recent data shows. This information can illuminate what to expect, and what next steps are recommended to realize dreams of homeownership. While everyone’s situation is unique, this goal may be more within reach than many realize.
Must homeownership goals be delayed because of student loan debt?
This is a common belief, and National Association of Realtors (NAR) comments accordingly:
“When asked specifically about purchasing a home, half of non-homeowners say student loan debt is delaying them from purchasing a home (51%).”
When asked why their student loans are putting their plans on the back burner, three key themes emerged:
- 47% say their student loans make it harder to save for a down payment;
- 45% say they think they cannot qualify for a home loan because of existing debt;
- 43% say they believe the delay is necessary even though they’ve never applied for a mortgage loan.
In fact, a delay may not be necessary. Read on.
Is it possible to qualify for a home loan if there are student loans outstanding?
In the same NAR report, data shows many current homeowners have student loan debt themselves:
“Nearly one-quarter of all home buyers, and 37% of first-time buyers, had student debt, with a typical amount of $30,000.”
That means other people in a similar situation were able to qualify for and buy a home, even though they also had student loan debt. Others may be able to do the same, especially if there is a steady source of income.
Apartment Therapy concurs:
“. . . buying a home with student loans is possible, experts say. The proof is in the numbers, too: Some 40 percent of first-time homebuyers have student loan debt, according to the NAR study.”
The key takeaway is that - for many people - homeownership is achievable even with student loans.
The best way to make a decision about specific goals and next steps is to talk to the professionals. An expert real estate advisor like Dennis Hartley can clarify the understanding of a specific situation, recommend options available, and share what has worked for other buyers with similar cases. They can also connect first-time buyers with other professionals in the industry who can help.
It isn’t necessary to figure all of this complicated information on one’s own. It is recommended that one lean on the experts so that information needed is clear in order to make an informed, confident decision.
Many other buyers with student loan debt are already achieving their homeownership dreams.
Maybe it’s time to take the next step toward making yours a reality. Connect with Dennis Hartley today to discuss your options and find out how close you are to achieving your goal.