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Family 411: Student Loan Debt
CINCINNATI (Sheila Gray) -- Americans' student loan debt stands at a record high, more than a trillion dollars.
That high debt is preventing many young families from buying a first home. Adam and Heidi Clary have been looking for a home for their growing family. When they tried to get approved for a mortgage, they got a surprise.
"We're doing everything right, but it seems like on paper, we're not," Adam said.
The Clarys both have student loan debt from pursuing graduate degrees.
"We've been going to school to make a better life for our family and these girls, and that kind of comes back to bite you when all of a sudden you may not be able to get the home you want," Heidi tells us.
It's because of new banking laws passed after the U.S. financial crisis. It's harder to get a mortgage. Mortgage adviser Mark Behler says even if home buyers don't have to start paying right away on a student loan it counts in their debt to income ratio. And student loan debt is even higher than America's credit card debt.
"I think we'll see people waiting longer, putting off home purchases," Behler said.
"That is one of the most frustrating parts of our business now," said realtor Fritz Kuhlman who helped Keith Lanser buy his first home.
A smaller home than Lanser first planned but still integral to the U.S. economy.
The housing sector is a linchpin of the economy. To keep it strong, experts recommend future home buyers to think way ahead, as far ahead as choosing college and careers.
The Clarys will close soon on a house after living with his sister's family for the past seven months.
"Having our own house will be amazing for the girls to have their own room," they tell us.
A difficult road to the American dream and one which took longer than they expected.
Experts say home prices and mortgage rates are headed higher. Do your homework if you're thinking about buying a home and check your credit report. Many realtors also have information about mortgage assistance programs.
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