I reside in NY where I have my primary home and have (3) rentals in SC. I recently applied for a HELOC's on my primary residence in NY and(2) of my out of state rentals via TD Bank and was denied on all (3) due to debt/income ration being over their guideline of 40% - I am at 67%.
I have $25k in credit card debt on (3) cards at 0% that I can pay off if need be but from what the underwriter explained, the reduction in monthly payment would not be enough to get me under the 40% debt/income guideline for TD. Basically I need to show more income or have lower mortgage debt; neither of which is immediately feasible.
The big bank mortgage holders (Chase / Guild) for my primary and rentals either don't do HELOC's or denied me due to debt/income being too high.
My credit score is in the 780's
I earn $175k+
$75k equity in primary home in NY
$125k in equity in each of the (2) rentals that I'd like HELOC's on in SC - I've managed to get a HELOC on the 3rd as its second home
The purpose for the HELOC's is to purchase multiple BRRRR properties.
Need to find a lender that can help me obtain HELOC's on my primary in NY and my (2) rentals in SC.
Any and all suggestions are greatly appreciated - THX in advance
175k and that dti...... How many car payments do you have??
I can only give you bias advice as I work in underwriting myself, I would tell you that 40% DTI is a reasonable metric to follow and it's their for a reason. Some go over it, some go less, no one goes over 70% though, and for good reason.
I'm also unclear how you have so many rentals, with so much equity, and your dti isn't increasing?!? if you have low return on equity AND low cash flow then maybe sell some of your rentals.
you also won't be able to BRRR with that dti, you're going to run into the same problem when you tackle a refi.
I have 1 car payment (lease) and it is a modest $375
Selling the rentals is a very last resort as I just put new roofs on each. Low cash flow on each.
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