Yes, you can buy a home with student loans. Lenders add a monthly student loan payment to your debt-to-income ratio (DTI). If your credit report shows a payment above $0, both Fannie Mae and FHA let the lender use it. The rules differ when the payment shows as $0. Fannie Mae can use $0 if you are on an income-driven plan and the lender verifies your payment really is $0. If the loan is deferred or in forbearance, Fannie Mae uses 1% of the balance or a full payment from your loan terms. FHA uses 0.5% of the balance whenever the credit report shows $0.
Many first-time buyers in Nashville, Franklin, and Brentwood have student loans. That does not stop you from buying. What matters is the monthly payment the lender must count in your DTI. DTI is all your monthly debt payments, including the new house payment, divided by your monthly income before taxes.
| Your situation | Conventional (Fannie Mae) | FHA |
|---|---|---|
| Credit report shows a payment above $0 | Lender may use that payment (or the payment on your latest student loan statement if the report is wrong) | Lender uses that payment or your actual documented payment |
| Income-driven plan, payment is $0 | May use $0 if the lender verifies it with your loan papers | Uses 0.5% of the balance each month |
| Deferred or in forbearance | 1% of the balance, or a full payment from your loan terms | Uses 0.5% of the balance if the report shows $0 |
| Loan forgiven, canceled, or paid off | A paid-off loan is no longer a monthly debt | May be left out with written proof from the servicer |
| Situation | Fannie Mae payment counted | FHA payment counted |
|---|---|---|
| Income-driven plan at $0 (verified) | $0 | $200 a month (0.5%) |
| Deferred, credit report shows $0 | $400 a month (1%), or the full payment from your terms | $200 a month (0.5%) |
| Paying $310 a month (example) | $310 | $310 |
This is just math to show how the rules work. Your real numbers depend on your loan papers and credit report.
Want to run your own numbers? Try the free mortgage calculators. They are estimates only, not a loan offer.
To see how DTI turns into a price range, read How much house can I afford in Franklin, TN?
No. Lenders count your student loan payment in your debt-to-income ratio. If your DTI fits the loan's limits, you can still qualify.
Fannie Mae lets the lender use $0 if it gets your student loan papers showing your payment really is $0.
FHA uses 0.5% of your loan balance each month when your credit report shows $0. For a $40,000 balance, that is $200 a month.
For Fannie Mae, the lender uses 1% of the balance or a full payment based on your loan terms. For FHA, the lender uses 0.5% of the balance if your credit report shows $0.
FHA lets the lender leave them out with written proof that the loan was forgiven, canceled, discharged, or paid in full. Paid-off loans are not monthly debts.
Bring your latest student loan statement and any letter showing your repayment plan and payment amount.
Have student loans and want to know which loan counts them best? Call me at (615) 495-6594, email travis@heathrowmtg.com, or start an application.
Figures checked October 11, 2026. Rules and rates can change. Examples are for illustration only and are not a loan offer.
