Financing multiple income properties

[Mike Jay]

Hey everyone,

If i get a income property and it covers the mortgage how soon and i ask the bank for another loan? If i come up with 25% down do i have to wait 2 years and show on taxes or something?

Thanks

[Chris Davidson]

@Mike Jay you can ask the bank for a loan right away. It all depends on your situation if you have enough income and reserves you can get a loan.

[Eliott Elias]

You can get a DSCR loan instantaneously. No need to wait two years. These lenders qualify the property, not the individual.

[Erik Estrada]

Quote from @Mike Jay:

Hey everyone,

If i get a income property and it covers the mortgage how soon and i ask the bank for another loan? If i come up with 25% down do i have to wait 2 years and show on taxes or something?

Thanks

 Hey Mike, 

As others mentioned, with a DSCR loan you can finance multiple properties at any time, given the properties debt cover, you have the FICO score (typically above 650), and you have 20-25% down.

[Ryan Randall]

Try and get a conventional loan. They should be able to use 75% of your rental income to see if it covers PITI. If so, then your current mortgage counts as a "net-positive" to your overall income and you can qualify for even more on your next purchase.

Don't assume that you need to go the more expensive DSCR route. Good luck.

[Matt Barth]

Assuming you mean a loan independent of that property, potentially right away. If you are trying to buy a house or multi up to a 4plex with FHA I think you can only have one of those at a time (but you might want to double check on that). You mentioned 25% down, so I'm assuming that's not the case and you should be fine to turn and burn again if you have the cash.

[Mike Jay]

Appreciate the input. 

[Stephanie P.]

Quote from @Mike Jay:

Hey everyone,

If i get a income property and it covers the mortgage how soon and i ask the bank for another loan? If i come up with 25% down do i have to wait 2 years and show on taxes or something?

Thanks

As others have said, you can get another loan right away, but there are some pieces you'll have to get your mortgage broker to dig into. What's the rent for the first property? Is it currently rented so you can count 3/4 of the rent in your debt ratio? Once you figure that out, you'll be able to determine whether you can afford to buy the 2nd house. If you can't go conventional, THEN, you should look at DSCR financing. Always exhaust your conventional options first, but don't discount DSCR. They close and still cash flow if you buy right.

[Upen Patel]

Quote from @Mike Jay:

Hey everyone,

If i get a income property and it covers the mortgage how soon and i ask the bank for another loan? If i come up with 25% down do i have to wait 2 years and show on taxes or something?

Thanks

There is no wait period to be able to use rental income. You need to have the income to meet DTI (using the rental incomes) and you have the assets to meet down payment and reserves. If you have that, you can buy up to 10 conventionally financed properties. You can even buy multiple properties at one go.

If you have DTI issues OR you have maxed out the 10 conventionally financed properties, then you would have to go DSCR.

[Simmy Ahluwalia]

You can have a 100 properties in your Portfolio with DSCR loans. We don't care as long as the mortgage is getting paid:)

[Dave Skow]

@Mike Jay- thanks ...is asking for a loan on a  rental property asnd  if you  have owned it for  under a  yr  so that it doesnt  appear on your  most recent tax return - most lenders  will allow you to use  75% of the rental income verified  from the lease  to help offset the mtg payment ..the  resulting  figure will be  added as  additonal income  if a positive  number  and  it will count as an additonal debt if its a negative  #...hope this helps  an good luck

[Paul De Luca]

Quote from @Mike Jay:

Hey everyone,

If i get a income property and it covers the mortgage how soon and i ask the bank for another loan? If i come up with 25% down do i have to wait 2 years and show on taxes or something?

Thanks

It really depends on your DTI if getting a conventional loan and like others have pointed out for a DSCR (debt service coverage ratio) loan you could get one immediately as long as you have the cash & the property meets the minimum DSCR.