Stuck on DTI: How to Keep Investing Without Displacing Family?

[Alexander Popham]

Hi All,

I’ve found myself in a bit of a conundrum and could use a fresh perspective to see if there’s a smarter path forward than what I’ve been able to come up with.

I currently own five homes and a few subdivided lots that I’ve added value to through entitlements, rezoning, or re-platting. Four of the homes have active loans. Three of them are occupied by relatives, and while I charge enough rent to cover expenses (except for my grandmother’s—those costs I personally cover), they’re not at market rates. The fourth home is my personal residence, which I’m considering converting to a rental—or potentially selling—so I can alleviate some underwriting friction and continue scaling my investments.

The main challenge I keep running into is debt-to-income (DTI) issues whenever I apply for a new loan for a personal property. I'd like to build a home for myself on one of the lots, and in the future, I'd like to develop the remaining lots into rental or for-sale homes.

Is there a way to structure ownership, financing, or property management so that my investment activity doesn't weigh so heavily on my personal DTI? I'm trying to keep things stable for my family while still growing my portfolio, and I feel like there has to be a better way to align all of this.

Appreciate any insight!

[Bruce Woodruff]

My first thought is a big NO !! You can't charge below market and es[ect to get anywhere....well except I guess you get a nice warm, fuzzy feeling once in a while?

I would sit down and decide if you want to run a business or a charity, you generally cannot do both.