How Do Lumen Mortgage's Physician Loan Programs Treat Student Loans?
It depends on how you qualify. If you qualify on residency or fellowship income, all three of Lumen Mortgage's physician loan programs can leave deferred, forbearance, or $0 income-driven student loan payments out of your debt-to-income ratio entirely. Attendings and new hires, including residents buying on a signed attending contract, have their student loans counted. Program 1 (100% Fixed) and Program 3 (100% Adjustable) follow standard agency guidelines. Program 2 (High-Balance & Flexible) counts a loan with no reported payment at 0.5% of the balance, a fully amortized payment, or your documented repayment amount, about half the 1% standard guidelines usually use.
Key Facts
Why Student Loans Matter So Much
Student debt is often the biggest obstacle to buying a home early in a medical career. Lumen Mortgage is a lender that can both fund and broker loans, so we offer three physician loan programs, each with its own way of counting student loans. Instead of forcing your file into one set of rules, we match it to the program that treats your debt most favorably.
Residents and Fellows
If you qualify on your residency or fellowship income, all three programs can leave deferred, forbearance, or $0 income-driven payments out of your debt-to-income ratio entirely. Any of the three programs can work, and your student loans typically drop out of the calculation. Your degree still decides which programs you can use; see who qualifies for a physician loan.
Attendings, New Hires, and Everyone Else
If you qualify on attending or new-hire income, your student loans are counted, and the programs differ: - Program 1 (100% Fixed): standard agency guidelines. - Program 2 (High-Balance & Flexible): if no payment reports, we use 0.5% of the balance, a fully amortized payment, or your documented repayment amount. - Program 3 (100% Adjustable): standard agency guidelines. The same applies to residents buying on a signed attending contract. Once you qualify on your future salary, student loans are counted, so we run the numbers across all three programs to find the best result.
Why 0.5% vs. 1% Matters
Under standard guidelines, a deferred or forbearance student loan with no reported payment is usually counted at 1% of the balance each month. Program 2 counts it at half that. On $300,000 of student debt, that's about $3,000 a month added to your debt-to-income ratio under standard rules, compared with $1,500 on Program 2. For an attending physician with large deferred balances, that difference can decide whether you qualify and how much home you can buy. Model both numbers with our DTI calculator.
Where Each Program Fits
- Residents and fellows on residency income: any of the three programs can work, and your student loans typically drop out of the calculation. - Attendings or new hires with deferred or forbearance loans: Program 2's 0.5% calculation is often the strongest fit. - Borrowers on an income-driven plan with a documented $0 payment: Programs 1 and 3 may allow that $0 payment, so we'll compare all three for your file. - Residents buying on a signed attending contract: once you qualify on your future salary, student loans are counted. We run the numbers across programs to find the best result. For how the programs differ on down payment and loan size, see our Oregon physician loan and California physician loan pages.
Nurses: How the Nurse Home Loan Counts Student Loans
Registered nurses, nurse practitioners, CRNAs, and clinical nurse specialists can use our nurse home loan, which has its own student loan rule. We use the monthly payment on your credit report. If no payment reports, we use 0.5% of the balance, a fully amortized payment, or your documented repayment amount, the same alternatives as Program 2. The nurse program doesn't have the residency and fellowship exclusion described above, so your student loans are always counted in some form. On $80,000 of deferred student debt with no reported payment, 0.5% is $400 a month, compared with $800 under a 1% standard rule. NPs and CRNAs may also be eligible for physician programs: CRNAs with a DNP or DNAP can use all three, and NPs can use Programs 2 and 3. We'll compare your options. If you're buying your first home, see our first-time home buyer guide for nurses.
Every File Is Different
Final treatment of student loans is determined during underwriting. Talk to a Lumen Mortgage loan officer at 503-966-9255 to see how your student loans would be counted. Have your servicer statements ready, including any deferment or forbearance letter and your most recent income-driven repayment certification.
Student loan treatment by program
How each Lumen physician loan program counts student loans in your debt-to-income ratio.
| Program 1: 100% Fixed | Program 2: High-Balance & Flexible | Program 3: 100% Adjustable | |
|---|---|---|---|
| Student loans excluded from DTI | Residents and fellows qualifying on residency or fellowship income | Residents and fellows qualifying on residency or fellowship income | Residents and fellows qualifying on residency or fellowship income |
| Types of payments excluded | Deferred, forbearance, or $0 under an income-driven plan | Same | Same |
| Attendings, new hires, and other borrowers | Standard agency guidelines | If no payment reports: 0.5% of the balance, a fully amortized payment, or your documented repayment amount | Standard agency guidelines |
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