Cash Out Refi: PSLF forbearance

[Eric R. Dehner]

Hi Gang,

I’m looking to complete a Cash Out refi on a property I bought last October. My student loans are currently in forbearance through the public student loan forgiveness program (PSLF) due to Covid 19. My total student loan amount is high (>300k).

My loan officer said because they are in forbearance they will need to estimate a 1% payment (>$3000.00) per month. This is much higher than i was paying pre-pandemic, monthly payments approx $1000.00. Because of this estimated payment my debt to income ratio isn’t working out to push the conventional loan through.

Has anyone else had this issue? Any workarounds?

Thanks so much,

Eric