Updated almost 5 years ago on . Most recent reply
Debt to Income Ratio and Long Distance Investment
All throughout Chiropractic school, I was sharpening my axe to start investing once I graduated. I wanted to start investing early so I can get out of the rat race as fast as possible; ultimately to provide the care for to patients based off of what they need, not how well I need my business to do so I can pay bills
With that out of the way. I am looking to invest in small multi-family, out of state, in the Cincinnati/Dayton OH corridor because I have friends who can be my boots on the ground. I have $280,000 in student loans and know that if I were to get a loan it would need to be a physician loan. The issue with most physician loans is that they are for primary residence only, not investment properties.
My question/discussion is, are there any other medical field providers or those with massive debt to income ratios who have been successful with securing funding for out of state investing?
Thank you so much for taking the time to respond and provide insight for a newbie investor.
Most Popular Reply
Steven's right. Your total debt amount doesn't matter it's what your DTI ratio is. We've done a couple physician loans on our primary residence but not for an out of state multi-family. However I believe most of the physician lenders will allow for a doctor loan for a 2nd home which you could buy and rent out. They require around 10% down but it may be an option to get you going and you can avoid PMI etc. I would just reach out directly to a couple of them that lends in Ohio and see what they require so you can plan it out.
Another option would be to just bank enough for your down payment and then go the typical lending route. If you your student loans are on an income repayment plan maxed at 10% then as long as you save your down payment and keep your other expenses in check you should be able to find a lender.
A third option would be to join a small real estate syndicate and pool your resources together to buy some properties where you're looking. You'll have some partners going this route but you can possibly avoid the lending and DTI hassles.