So since I am self employed and wrote off a lot on my taxes.. I am only able to be lent about 104k
I'm looking at properties that are 100-130k
I have 26k saved
Rents should come in around 900-1100
Taxes around 900-1100.
How do I get into a second property this year?
A friend said he is going to gift me 10-20k for this.
I could probably pay enough to get to 50 equality in my first property and then leverage it?
Could maybe amend my taxes to get another 10k income for this year which would allow me to borrow another 10k.
Look and think bigger.
Get 5+ units. Banks lend on these properties based on building performance not you personal. (As long as the building cash flows and its a great deal)
Leverage is the reason why Real Estate is great- Take advantage.
Owner occupied, or pure rental? Cash-out refi's on rentals are still possible (there are those who claim they are almost unavailable, but I have had no trouble) but they won't go above 75% LTV.
So if you buy a $100k property with 50% down (don't forget to account for closing costs!), you will be at an LTV of 50%. You would theoretically be able to $25k back out. Whether getting $25k out is worth the closing costs associated with THAT loan is pretty questionable, to me.
And all of that just sort of wishes away your DTI problem. If all the debt your provable income will support is $104,000, then that is all it will support.
I suspect your best bet is to slow down just a bit. Buy one property, rent it out long enough to have the income from that counted against your DTI (at my credit union, that is schedule E income on two consecutive tax returrns, but I understand people have had better experiences than me), and then get approved for the next based on your now increased income.
Or buy a multi and live in one unit.
I don't have experience in a rent so getting into a 5 unit property is a bit much for me. Plus I want to make sure if it stands vacant I can afford the mortgage.
I can't do multifamily and live in one because I plan investing in one state over... And my business is in California.. Otherwise I would love to have a hack home.
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