What must always be included in the debt-to-income (DTI) ratio for all student loans?

The debt-to-income (DTI) ratio is a critical financial metric used in assessing a borrower’s ability to manage monthly payments and repay debts. For all student loans, it is essential to include a payment in the DTI calculation, regardless of the loan type. This inclusion ensures that lenders evaluate the borrower's total financial obligations accurately, which can impact their eligibility for a loan.

Even if a student loan is in deferment or has an income-driven repayment plan, a calculated monthly payment (which could be zero for certain plans) will still count toward the DTI ratio. This conservative approach allows lenders to better assess the risk associated with lending, acknowledging that even deferred loans have the potential to become a financial obligation in the future.

By including a payment for all types of student loans, lenders maintain a comprehensive view of the borrower’s financial landscape, providing them with essential information to make informed lending decisions.