New Fannie Mae programs emerge to incentivize people with student loan debt to invest in homes
Nation: Fannie Mae has produced new programs to incentivize people with notable student loan debt to invest in a home while paying down their debt.
People with mounting student loans, and concerns for those to come that will likely be taking on middling to massive student loan debt, have come more and more often to the forefront of political as well as housing market discussions due to numbers suggesting fewer investments into home ownership by younger generations; based in part on the very student loan debt taken on to try and become gainfully employed to allow purchase of a home.
Under Fannie Mae’s new offerings, the oft-described “vicious cycle” of going into debt for college education in order to get a job to pay for that debt could be mitigated in part by allowing those debtors to cut the loan debt from their debt-to-income ratio, as well as allowing lenders to accept student loan payment information on credit reports.
These changes to credit reporting and approvals might turn out to be the bump in incentive that portions of the housing market have been looking for to help comfort worries that the Millennial generation is steering away from the notion of “putting down roots.”
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