Usually yes, with conditions: Fannie Mae, Freddie Mac and USDA draw the line at 10 or fewer payments remaining, FHA at debts paid off within 10 months from closing, and VA at a remaining term of less than 10 months. Fannie Mae says a shorter debt should still be counted if it significantly affects the borrower's ability to meet credit obligations, and Fannie Mae and Freddie Mac count lease payments regardless of the months left. FHA also requires the combined payments of such debts to be 5 percent or less of gross monthly income and bars paying a balance down to meet the 10-month requirement, while USDA requires each omitted payment to be no more than five percent of monthly repayment income. VA counts debts with a remaining term of 10 months or more, and also counts shorter debts whose payments would severely affect the family's resources.
Fannie Mae (conventional)
- Installment debt not secured by a financial asset, including student, auto and personal loans and timeshares, must be counted when more than ten monthly payments remain. Fannie Mae B3-6-05
- A debt with fewer payments left "also should be considered" if it significantly affects the borrower's ability to meet credit obligations. Fannie Mae B3-6-05
- Lease payments count regardless of the number of months remaining on the lease. Fannie Mae B3-6-05
- An installment loan paid down to 10 or fewer remaining payments generally need not be included in long-term debt, but payoff or paydown solely to qualify must be carefully evaluated. Fannie Mae B3-6-07
Freddie Mac (conventional)
- Installment debts with more than 10 months of payments remaining, including deferred or forborne debts, are included; installment debt may be excluded when the credit report or file documentation verifies 10 or fewer months remain. Freddie Mac 5401.2
- When a debt is paid off or paid down to qualify, the seller must document the source of funds. Freddie Mac 5401.2
- Lease payments are included regardless of the payments remaining, even when the lease is paid down; an automobile lease that is paid off or prepaid may be excluded. Freddie Mac 5401.2
FHA
- In both TOTAL and manual underwriting, closed-end debts may be left out if they will be paid off within 10 months from the date of closing and the cumulative payments of all such debts are 5 percent or less of gross monthly income. FHA 4000.1 II.A.4.b.iv FHA 4000.1 II.A.5.a.iv
- The borrower may not pay down a balance to meet the 10-month requirement. FHA 4000.1 II.A.4.b.iv FHA 4000.1 II.A.5.a.iv
VA
- Significant debts include those with a remaining term of 10 months or more, and those with less than 10 months whose payments are so large they would severely affect the family's resources. VA Pamphlet 26-7, Ch. 4 Topic 5
- The lender also decides whether debts that are not significant should be given weight, since they may affect the borrower's ability to cover family living expenses. VA Pamphlet 26-7, Ch. 4 Topic 5
USDA
- If ten or fewer months remain on an individual installment account, its payment may be omitted when it does not exceed five percent of the monthly repayment income. USDA HB-1-3555 11.2
- Installment debt may be paid down to ten months or less of remaining debt. USDA HB-1-3555 11.2
Sources
- Fannie Mae Selling Guide, September 2, 2026 version: B3-6-05, Monthly Debt Obligations (Installment Debt) (p. 519); B3-6-05, Monthly Debt Obligations (Lease Payments) (p. 519); B3-6-07, Debts Paid Off At or Prior to Closing (Payoff or Paydown of Debt for Qualification) (p. 524)
- Freddie Mac Single-Family Seller/Servicer Guide, September 16, 2026 version: 5401.2(b), Liabilities included in the monthly DTI ratio (2. Installment debts) (p. 5401-6); 5401.2(a)(ii), Debt pay offs and pay downs (p. 5401-6); 5401.2(b), Liabilities included in the monthly DTI ratio (6. Monthly lease payments) (p. 5401-10)
- FHA Single Family Housing Policy Handbook 4000.1, August 12, 2026 version: II.A.4.b.iv, Evaluating Liabilities and Debts (TOTAL): General Liabilities and Debts (p. 213); II.A.5.a.iv, Evaluating Liabilities and Debts (Manual): General Liabilities and Debts (Manual) (p. 291)
- VA Lender's Handbook (VA Pamphlet 26-7), August 12, 2026 version: Chapter 4, Topic 5: Debts and Obligations, c. Analysis of Debts and Obligations (PDF p. 97)
- USDA HB-1-3555 Guaranteed Loan Program Handbook, March 2, 2026 version: Chapter 11, 11.2 The Ratios (B. The Total Debt Ratio, 2. Installment Accounts) (p. 11-2)
Agency guides set the baseline; individual lenders can add stricter overlays. Sources are the guideline versions in Zeitro Strata as of October 29, 2026.