Homebuying expert says millennials can still get a mortgage even with student loans. Here’s how.

Millennials shouldn’t opt-out of buying a home just because of their student loans.Student loans add to the debt-to-income ratio, but they won’t necessarily stop someone’s ability to get a home they want. Using a budget to pay down debt and save for this goal is a great way to make the dream possible.Lending experts are a great resource when looking to understand what financial options are available. This is a contributed piece as part of a series called Master your Money.

With the weight of monthly payments on their shoulders, many young, prospective homebuyers feel that owning a home is impossible because of student loan debt and self-select out of homeownership, fearing they cannot afford the costs.My role at Bank of America is to guide people through the home buying process so they can get on the right path to sustainable homeownership.First-time homebuyers are apprehensive about the process, particularly about understanding the qualification requirements for a home loan. It’s okay to have student loan debt; you don’t need a 20% down payment and you don’t need a perfect credit score. Preparation is key and I always provide our customers with three pieces of advice:Budget, save, budget, saveBudgeting and saving should become your mantra. Take a close look at your finances and set up a budget to understand where your money is going and what you have left each month. Doing this will provide a better picture of your financial decisions and inform changes you should make, such as upping your student loan payments or contributing more to savings.

By sticking to the budget in place, you can start to work your way towards homeownership at a pace that makes sense for you and your finances. Many times home buyers realize the extra earning power that came with their degree is precisely what helps them comfortably budget their student loan debt into their total monthly budget with a comfortable mortgage payment.Prioritize paying down debtIf you realize you are operating from a position of excessive debt, reducing your debt-to-income ratio makes you a more attractive borrower. Your debt-to-income ratio is the percentage of your monthly pre-tax income that must be spent on your monthly debt.For example, if you earn $5,000 a month in pre-tax income and have monthly student loan payments of $600, your debt-to-income ratio would be $600 divided by $5,000, or 12%.When my daughter bought her home two years ago, her husband had over $250k in student loan debt. Fortunately, they didn’t need his income to qualify for the loan and therefore did not need to include his debt in their loan application.

Before you decide that you’ll never qualify for a home loan, discuss your personal financial situation with a loan officer to explore options. Whether or not you are ready to buy, lowering debt will always be beneficial, so make it the number one priority.Understand what you are working towards Understanding your budget is just one piece of the financial puzzle when it comes to homebuying. To learn about the loan options that make sense for you, meet with a lending expert who can provide more information on current interest rates and how much you can borrow.Once you find a loan that fits your needs, get prequalified or preapproved to get a solid understanding of how much you could borrow.Taking the first steps toward homeownership may feel overwhelming, but according to a report from our company about homebuyers, homeownership provides a sense of financial satisfaction and an improved lifestyle. There’s no better time to educate yourself on what’s possible for your future.

It may take some time and effort, but with a little elbow grease, your dream of owning an affordable home is within reach – even with student loan debt.

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