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Are your student loans preventing you from securing a mortgage to purchase a dream home?
According to a recent United Way of Central Alabama workshop about college debt and new Federal Housing Administration — FHA home loan guidelines, help is on the way.
United Way Student Loan Workshop
Raise your hand if you are still paying off those pesky student loans. You are not alone.
In February 2021, more than 45 million borrowers collectively owed $1.7 trillion in student loan debt. That’s trillion with a capital T.
College debt in the U.S. keeps growing and growing. Check out these eye-popping numbers:
- Student loan borrowers now graduate with an average of $37,172 in student loan debt.
- In a recent Nitro survey 41% of people with student loans said they wouldn’t be able to afford a surprise bill of $400.
Educating and providing resources to Central Alabama residents about financial matters is what the United Way’s Financial Stability Partnership does best.
Earlier this month, the partnership held an invaluable hour-long virtual workshop on student loans.
During the workshop, two local United Way partners gave presentations and answered questions with local participants. They were:
- Melissa Burgett, Director of Financial Aid at Birmingham-Southern College
- Phillip Bazinet, Desmond Ingram and Jasper Wiggins from Wells Fargo Bank
New Student Loan FHA Guidelines
The workshop was timely and informative. One of the main takeaways was how student loans may affect the mortgage process, thanks to incoming changes by the Biden Administration to FHA requirements. The new rules go into effect August 15.
These recent reforms, which were rolled out in June, will benefit borrowers because it allows lenders to not be as strict relative to borrowing limits for persons with student loans.
Why does that matter? Over 80 percent of FHA-insured mortgages are for first-time homebuyers. FHA estimates that more than 45 percent of these borrowers also have student loan debt.
Each speaker at the workshop not only gave advice, but they also told stories about their own experience with student debt.
They each concurred that if you need assistance and/or information dealing with current student loans——the best thing to do is contact your current student loan service directly via phone.
Birmingham-Southern’s Melissa Burgett also encouraged people to visit www.studentaid.gov. In fact, that is everyone’s “go to” resource if you need answers.
In addition to the www.studentaid.gov – United Way also recommends these links:
Locally, if you need further assistance or information, call United Way’s 2-1-1.
About the United Way’s Financial Stability Partnership
United Way’s Financial Stability Partnership includes more than 100 partners statewide focused on helping hard-working families become and remain economically secure.
The coalition provides tools to low-to-moderate income individuals so that they have the necessary skills to weather life’s unexpected challenges and to develop financial planning strategies to help these individuals emerge stronger than they were before the hardship.
The UWCA provides workshops like the one on student loans generally twice per month. These workshops are on topics like homeownership 101, Buying vs. Renting, Financial Stress Busters, You and Your Credit and much more.
The upcoming workshops in August will focus on Fighting Fraud and Identity Theft (August 10th) and Small Business “Making Small Business Your Business” (August 25th). Check the United Way website closer to the event for online registration information.