Hey BP,

Working on my third deal (second rental) and started laying the ground work on a 91 day seasoning period loan. My question is- does personal debt to income ratio matter if the property is in an LLc when you refi? I have another rental and a primary house so I'm thinking this would put me over the threshold for debt-income but I know folks use this method to scale so I'm sure I'm overlooking something. Whats the best practice? Commercial loan? High equity? Large w2 income? Help!

-Thomas

For conventional loan, they do look at DTI. But don't forget you can use the rental income from your rental to help with your income and DTI. And conventional loans don't let you vest in an LLC, you will have to put in your name and then switch vesting to LLC. There are some credit unions and regional banks that will let you vest in LLC.

Commercial loans are good option. They look at the property and not your DTI. They are called DSCR loan, or debt service coverage ratio. Essentially you your rental income has to be 25% more than the mortgage. But interest rates are much higher for these loans, so your numbers have to work.

Good Luck!

@Jesse Rivera

Super helpful! Thanks Jesse!