I Need Help Refi Primary Residence while owning Rental Property

1 Reply

Long story, will try to make it small.

My son and I invested in some properties about mid 2017. We did not know what we were doing and ended up buying 2 fix and flip properties that we never flipped because we moved into them ourselves. I moved into one and he moved into the other. The issue was that both of these properties are under my name. The one that I live in being my Primary Residence, which technically puts the other as my investment property. My sons credit could not be worse at the moment either so i cant sell him the house, at least not that i know of... He has been making the payments on the house for over a year and a half now, but he has not been consistent with how he sends in the payment. What i mean by this is that he has an existing business account from which he would send in the payments for some times, and he would also make some payments in cash, and just last month he sent in the payment from his personal checking account. there was even a couple of months when he asked me to go and make the payments in person with my own personal checks because he was busy at work.  So just about a month ago I started working with the bank that I have my primary mortage and was trying to refi and cash out to make some additions to the house and with what money i had left over start building my retirement home in rosarito. turns out the bank had me do the appraisal and prequalified me no problem because the equity in the house is high. current balance of $110k and appraised at $255k. Later to find out that the property my son lives in is the biggest obstacle because i have no proof of steady rental income. i make about $70k a year at my job, but that is not enough for the bank to approve the loan since they see it as if i were paying for both properties , so my debt to income ratio is off balance. 

If anyone out there can help me out by referring a bank or any help at all, I would highly appreciate it. 

I am in San Bernardino, CA . 


thanks a lot everyone

@Mario Ontiveros Greetings and Welcome to BP!

Are there any other debts you can pay off or pay down to help your DTI? Cars, Credit cards, personal loans, student loans? Can you sell the property your son is living in right now? Have you reported the rent you have been collecting from your son on your taxes? That is going to be your ultimate proof right there. You may have to wait a year or two and report it on your taxes.

I wish you the best!