The Federal Housing Administration announced Friday that it plans to make it easier for homebuyers with student debt to access FHA single-family loans.

The FHA said the move was necessitated by the high percentage of people of color with student loan debt. Typically, lenders are required to calculate a borrower’s monthly student loan payments at 1 percent of the outstanding balance for loans that are not fully amortizing or are not in repayment. This artificially raises the apparent debt burden of FHA borrowers with outstanding student loans, reducing the size of the mortgage they can take out, particularly as many student loans went into forbearance during the COVID-19 crisis.

In fact, the FHA said in a statement, many student loan borrowers have monthly payments that are lower than this.

On average, over 80 percent of FHA-insured mortgages each year are for first-time homebuyers. FHA estimates that more than 45 percent of these borrowers also have student loan debt, with much of this debt impacting people of color.

Under the new policy, lenders must calculate an FHA borrower’s student debt burden for loans not in repayment as 0.5 percent of the outstanding loan balance.

The change takes effect Aug. 16, but lenders can opt in sooner than that if they wish.

“Homeownership is the cornerstone of the American Dream and the best way to build generational wealth,” Housing and Urban Development Secretary Marcia L. Fudge said in a statement. “I am proud that FHA is taking action to make it easier for borrowers with student loan debt to qualify for a federally insured mortgage. This new policy will make a big difference for individuals throughout our nation and is another step in our mandate to promote equity and opportunity for homeownership.”