Good tax returns but no job while in grad school

[Jack Miller]

Hello, I am looking to buy my first property (most likely an investment fourplex), but just left my job to start a grad program. Prior to this, I had 2 years of good tax returns from 1 stable job as well as my side business. 

Now that I am in grad school I cannot work due to program guidelines and time, but am still wanting to buy an investment fourplex that can build me some equity to offset these ridiculous student loans. After grad school I anticipate starting salary of 300k+, but will have 200k student loans which will only delay/limit me from starting my real estate investing journey.

I have enough saved for up to 15% down payment on a fourplex around 450k, but dont want to go hard money lender/dscr as they are currently in 7-9% range. Is there any type of conventional/portfolio loan I can pursue? Or if you have any feedback please give me input. I just hope I can leverage my tax returns somehow, and my future career prospect but I really don't know.

Thank you all in advance!

[Erik Estrada]

Quote from @Jack Miller:

Hello, I am looking to buy my first property (most likely an investment fourplex), but just left my job to start a grad program. Prior to this, I had 2 years of good tax returns from 1 stable job as well as my side business. 

Now that I am in grad school I cannot work due to program guidelines and time, but am still wanting to buy an investment fourplex that can build me some equity to offset these ridiculous student loans. After grad school I anticipate starting salary of 300k+, but will have 200k student loans which will only delay/limit me from starting my real estate investing journey.

I have enough saved for up to 15% down payment on a fourplex around 450k, but dont want to go hard money lender/dscr as they are currently in 7-9% range. Is there any type of conventional/portfolio loan I can pursue? Or if you have any feedback please give me input. I just hope I can leverage my tax returns somehow, and my future career prospect but I really don't know.

Thank you all in advance!

What is the interest rate of the $200k in student loan debt? I would recommend holding off until you start making $300k +. You can use your college degree as work history and your most recent paystub as qualifying income. If you have a high DTI ratio because of the student loans, you can still qualify with up to 56.99% back end DTI on an FHA loan.

15% down will not be enough for a DCSR or Hard Money loan based on your circumstances. Lenders in this space require a minimum of 25% down + closing costs for a first time investor, first time homebuyer. On top of that most lenders require you to show  6+ months of reserves. 

In this scenario, you will benefit more by holding off to qualify for a standard primary residence loan and house hacking.