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Does chapter 13 payment and deferred student loans count in DTI calculations?
Please help me
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1 Reply
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Yes, both Chapter 13 bankruptcy payments and deferred student loans can count in Debt-to-Income (DTI) calculations, depending on the type of loan and lender guidelines.
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Chapter 13 Payments: The monthly payment you make under your Chapter 13 bankruptcy plan is typically included in your DTI calculation because it’s a required debt obligation.
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Deferred Student Loans: For most mortgage loans, lenders will include a percentage of the outstanding student loan balance in your DTI calculation, even if the loans are currently deferred. The amount of the percentage used on deferred student loans is 0.50% of the outstanding student loan balance.
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Income-Based Repayment: If the borrower has and IBR payment set up with the student loan provider, then the IBR payment is used no matter how little the monthly payment is.
Specific guidelines may vary depending on the loan program (FHA, VA, Conventional, etc.), so it’s essential to consult with a lender to understand how these factors impact your DTI ratio for your specific situation. VA loans exempt deferred student loans as long as the student loan has been deferred for longer than 12 months.
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