New user with a mortgage question

3 Replies

Hi all, 

I currently own a house and am trying to secure another mortgage to purchase a property to flip.  I rent two rooms in the house I live in.  I was told by Wells Fargo that my rental income would not be acceptable for use in my debt to income ratio unless it has been shown on my taxes for two years.  The leases were just started this year.  Is there any way around this?  I will not be able to secure a large enough loan without showing this income.



If its your primary residence I dont think they will be able to use rental income and I dont know of a way around it.  Now if you plan on moving out they would consider it true rental income and have to count it but you stated you are looking to do another flip so if you stay then sounds like your stuck. 

You can always borrow private money to finance your flip?

@Brandon Shipe  If you have signed leases with the folks who are renting the rooms from you and decent credit, I would recommend talking to a smallish, local, portfolio lender.  A credit union would be a good choice. They have a lot more leeway in their underwriting decisions.  The big banks, particularly the ones - like Chase, City & BofA - that got hammered in the mortgage crisis and the subsequent lawsuits, are not good options for anything other than the most standard and traditional of circumstances for mortgage lending.

I have not head of being able to count roommate rent unfortunately. Do you have a car loan or something else that is affect debt to equity numbers? A friend had to refinance his car and pay off his motorcycle to qualify. Another option is to rent out your entire house and rent another persons room depending on how long you have lived in the house. Some brokers will allow you to count the lease as proof of your rentals income

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