The number that decides your loan is not your balance. It is the monthly student loan payment your lender drops into your debt-to-income ratio. Fannie Mae will accept a documented $0 income-driven payment. FHA and Freddie Mac use 0.5% of your balance instead. Physician loan programs often set their own rule. Same borrower, same debt, three very different answers.
If you are carrying medical school debt and wondering whether it will sink your mortgage application, this page walks through exactly how each program treats it, what changed in July 2026, and what you can do about it. Take your time with it. This is worth understanding before you talk to a lender, not after.
Run your own numbers: our physician mortgage payment calculator shows what the monthly payment would be, and what the same house would cost on a conventional loan once mortgage insurance is added in.
Why This One Number Matters So Much
Lenders compare your monthly debt payments to your monthly income. That ratio is your DTI, and it is usually the thing that decides how much house you can buy, or whether you get approved at all.
For most borrowers, the debts are a car payment and a credit card. For a physician, one line dwarfs everything else. The Association of American Medical Colleges reports that 70% of the graduating class of 2025 carried education debt, with a median of $215,000 and an average of $223,130 (AAMC, October 2025).
So the question is not whether you have student debt. It is what monthly number your lender writes down next to it. That number is set by rules, not by your actual bank statement, and the rules differ by program.
What Changed in July 2026
If you read an article about this before the summer of 2026, some of it is now out of date. Three things moved:
- The SAVE plan ended. A court order closed it on March 10, 2026. Interest on SAVE balances resumed accruing back on August 1, 2025.
- A new plan, RAP, went live on July 1, 2026. The Repayment Assistance Plan is open to any Direct Loan borrower (34 CFR 685.209).
- IBR, PAYE and ICR narrowed. IBR stays open but only for loans made before July 1, 2026. PAYE and ICR are restricted to borrowers who were already repaying under them on July 1, 2024, and all three of the older income-contingent plans sunset after July 1, 2028.
One caution worth naming: servicer websites and regulation text do not currently agree on whether PAYE and ICR still accept new enrollments. The regulation reads as no. At least one servicer page still says yes. If either plan is part of your plan, confirm it with your servicer in writing before you count on it.
If You Are Still in the SAVE Forbearance, Read This Part First
Borrowers who were in SAVE are being moved off it. Servicers began sending notices on July 1, 2026, and each borrower has 90 days from the date of their own notice to pick a new plan. The notices are staggered through October 2026, so your deadline is on your letter, not on a calendar everyone shares.
Here is why this matters for a mortgage. If you do nothing and the 90 days run out, you are placed into the Standard or Tiered Standard plan automatically. Those produce a much larger monthly payment than an income-driven plan, and that larger payment is what shows up on your credit report and goes straight into your DTI.
Letting the deadline pass is one of the few ways to make your mortgage application meaningfully worse without doing anything at all. If you are house hunting, handle this first.
How Each Loan Program Counts Your Student Loans
This is the core of it. Four different rulebooks, four different answers.
| Program | If your credit report shows a payment | If your payment is $0 | If deferred or in forbearance |
|---|---|---|---|
| Fannie Mae | Uses the reported payment | Accepts $0 if you document an income-driven plan | 1% of the balance, or a documented payment that would actually pay the loan off |
| Freddie Mac | Uses the reported payment | 0.5% of the balance, unless you document a different payment above zero | Same 0.5% treatment |
| FHA | Uses the reported or documented payment above zero | 0.5% of the balance, with no exception for income-driven plans | Same 0.5% treatment |
| Physician loans | Varies by lender | Varies by lender | Several exclude deferred debt entirely |
Sources: Fannie Mae Selling Guide B3-6-05 (guide effective August 5, 2026); Freddie Mac student loan guidance (Bulletin 2025-10, effective September 28, 2025); FHA Mortgagee Letter 2021-13.
The short version: Fannie Mae is the only one of the three agencies that will honor a documented $0 income-driven payment. That single difference can move your approved loan amount by hundreds of thousands of dollars.
What This Looks Like on $215,000 of Debt
Take the median debt load for the class of 2025 and run it through each rule. Here is the monthly figure that lands in your DTI:
| Situation | Monthly amount counted |
|---|---|
| Fannie Mae, documented $0 income-driven payment | $0 |
| FHA or Freddie Mac, $0 payment reported (0.5% of balance) | $1,075 |
| Fannie Mae, loans deferred or in forbearance (1% of balance) | $2,150 |
That gap is the entire point. A resident earning $70,000 who gets counted at $2,150 a month is often not buying a house. The same resident counted at $0 usually is.
Why RAP Can Quietly Help Your Application
This is the part almost nobody has written about yet, and it is worth understanding.
Under RAP, your payment is a percentage of your adjusted gross income, stepping up by one point for every $10,000 of income. It starts at 1% for income between $10,001 and $20,000 and tops out at 10% above $100,000. You subtract $50 per dependent. There is a floor of $10 per month, which means a RAP borrower always has a real, documentable payment above zero (34 CFR 685.209).
Run a resident earning $70,000 through it. That falls in the 6% bracket, so the annual figure is $4,200, or roughly $350 a month. Under all three agency rulebooks, a documented payment above zero is used at face value.
Compare that with the same resident whose payment reports as $0 and gets hit with the 0.5% fallback: $1,075 a month. The RAP borrower looks better on paper by about $725 a month, which is real buying power.
RAP also waives unpaid interest and adds up to $50 a month toward principal, so the balance does not grow while you are in training. Payments under RAP count toward Public Service Loan Forgiveness if you meet the other requirements.
None of this makes RAP automatically the right plan for you. Forgiveness under RAP takes 360 payments over at least 30 years, which is a long horizon. But if a mortgage is on your near-term list, it is worth putting on the table with whoever advises you on your loans.
Where Public Service Loan Forgiveness Stands Right Now
PSLF still exists and still works the same way: 120 qualifying payments while working for a qualifying public service employer.
In late 2025 the Department of Education finalized a rule that would have excluded certain employers from qualifying, set to take effect July 1, 2026. Two federal courts vacated that rule on June 30, 2026, one day before it was due to start. The Department has appealed, and no stay is in place, so the prior employer eligibility rules are what govern today.
A lot of commentary written in the first half of 2026 says the restrictions took effect. They did not. If PSLF is part of your plan, that distinction matters.
What to Bring When You Talk to a Lender
You can make this much easier on yourself by walking in with the paperwork already in hand:
- Your current repayment plan confirmation from your servicer, showing the plan name and the monthly payment
- A recent statement showing the payment amount, in case your credit report is wrong or stale
- Your outstanding balance for each loan
- If you are moving off SAVE, the notice you received and the plan you selected
- If your loans are deferred, documentation of the deferment and its end date
Credit reports are frequently wrong about student loan payments. A statement from your servicer usually beats the credit report, and both Fannie Mae and Freddie Mac allow the lender to use it.
The Honest Summary
Your student loan balance is not the obstacle people assume it is. The obstacle is which rulebook your lender is using and what paperwork you brought. A borrower with $215,000 in debt can be counted at $0, at $350, at $1,075, or at $2,150 a month depending entirely on those two things.
Physician mortgage programs exist largely because of this problem. Several of them treat deferred medical school debt more generously than any agency rulebook does, which is why residents so often end up using one. You can read more about how physician mortgage qualification works, or whether buying during residency makes sense in the first place.
When you are ready, we can match you with a lender whose rules actually fit your situation. It takes a couple of minutes and there is no cost to you.
Last verified September 9, 2026. Student loan rules are changing quickly right now. We recheck this page monthly.