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While college enrollment for Hispanics is on the rise, many of these students will rely on student loans to finance their education and will graduate with substantial student loan debt. According to Pew Research, about 22 percent of Hispanic households headed by someone under the age of 40 have student loans. Since prime home buying also tends to take place by households in the 35 – 45 year age range, paying off significant student loan debt could delay other life choices like marriage, parenthood, and buying a home.

Understanding the connection between student loan debt and the slow growth of the housing market, last year Fannie Mae introduced a Student Loan Payoff Refi solution in partnership with SoFi. Lenders nationwide can now offer this product through Fannie Mae’s underwriting platform.

The Student Loan Cash-out Refinance helps homeowners with at least 20 percent home equity refinance to pay off high-interest rate student debt. At the loan close, the lender will pay off the student loan by disbursing the payment directly to the servicer of the student debt.

With interest rates still near historic lows, this refinancing option could help an estimated 8.5 million U.S. households pay down or completely pay off student debt obligations. To find out more about this innovative solution visit www.fannie mae.com