There are more than 44 million borrowers who collectively owe $1.5 trillion in student loan debt, according to finance site Make Lemonade. So, clearly, if you have student loan debt, you’re not alone.

The same student loan debt report also found that:

- Nearly 2.2 million student loan borrowers have a student loan balance of at least $100,000;

- There is $31 billion of student loan debt that is 3 months or more overdue;

- There is nearly $850 billion of outstanding student loan debt for borrowers age 40 or younger.

With so many millennials having graduated college and trying to start their life, it’s no wonder that purchasing a home looks completely infeasible. However, this is not the case. It is completely within reach to be able to purchase a home without outstanding student loans. Here are some steps you can take to make it a reality:

1. Focus on improving your credit score, or keeping it high if it already is.

The best way to do this is to make your monthly loan payments on time, along with any other debt such as credit cards. Paying off loans in a timely manner is a huge help when trying to improve or maintain credit score, so be sure to set up autopay if at all possible!

2. Figure out a debt-to-income ratio.

A debt-to-income ratio is the thing that will most likely prevent you from getting a loan if they are significant (along with credit score). This is also a huge factor in determining your interest rate. Lenders will use it to determine if your income is enough to pay living expenses plus any outstanding loans you may have. The simple answer isn’t the easiest, but the best way to manage your debt-to-income is by focusing on the two factors: debt and income. Either consolidate your debt, ideally by paying off what you can,, or make more income, but the two usually go hand-in-hand.

3. Get pre-approved for a home loan.

Pre-approval is a great way to see what amount you are eligible for for a home loan. See our March 21, 2019 article that explains the difference between pre-approval and pre-qualified.

4. Look for down payment assistance.

Here are a few to look into for qualification:

FHA loans - federal loan through the Federal Housing Authority

USDA loans - zero down mortgages for rural and suburban homeowners

VA loans - if military service or military spouse

There are federal, state and local assistance programs as well not mentioned here, so research and see if you may qualify for any.

5. And, if need be, refinance your student loans.

This relates back to the debt-to-income ratio that lenders look at, as student loan debt is factored into this and can affect your ability to get a loan. So, the lower your monthly repayments, the more attractive your ratio will look. Refinancing your student loans means you’ll be paying back a smaller amount for a longer period of time, but it is a good option if you want to buy a home and your ratio isn’t looking too good.

There are student loan refinance lenders who offer interest rates as low as 2.50% which is significantly lower than both federal and private loan rates. They do have qualifications as well, so make sure it would be something that is viable.