How do I get approved on refinancing on a BRRR without an 8-5?

Question

Hey, Bigger Pockets! I am thinking of making the transition to full-time Real Estate. We have a few rentals under our belts and have a 3rd under contract through hard money. Is there a way to get qualified for refi if I wouldn't be able to show 2 years of work history if I quit? If so how would I be able to get more rentals in the 2 years without employment history? Thank you.

Tesho Akindele · Answer

@Fernando N Cruz you could partner with someone who would be able to qualify for a loan

Fernando N Cruz · Answer

Thank you, @Jason Shackleton! I will be calling different lenders. I appreciate the info.

Fernando N Cruz · Answer

Awesome! Thank you, @Michael Glist.

Caroline Gerardo · Answer

Get your FICO score in order, this determines the pricing and have income deposited into a bank. Many programs available...

Michael Glist · Answer

So as mentioned you can look into DSCR loans as that would be a great option for you once you leave your job and cannot show normal 1099 and/or W2 income.

Since you already have rentals you may want to see if you are able to qualify based on your current/projected rental income. If you are showing a profit (according to the lenders calculations) you may be able to still qualify for a conventional loan using your current rental income and projected rental income.

I think it is worth a shot to see if you can go that route first and if not look at a DSCR loan.

Gaetano Ciambriello · Answer

Hi @Fernando N Cruz - if you would like to shoot me a PM, I can help!

Fernando N Cruz · Answer

Thank you,@Torrell Palmason for the info! I will be looking into this. Could anyone recommend a Non-QM DSCR lender in the Houston, Texas area? Thanks.

Torrell Palmason · Answer

If you are unable to show work history a option for you is Non-QM DSCR loan. With a DSCR loan, rents of subject property must be 100%-110% of the mortgage payment. The max LTV to value will be 85% and will require 6-12 months of reserves. The minimum Credit score is 660.

Since this is a Non-QM it will have higher rates than a Conventional but can give you time to get your work history in self-employed. There will be variations of the terms above based on program and lender however these are the terms set by the Non-QM DSCR 1-4 unit that my company uses.

Best of Luck!

Jason Shackleton · Answer

Hey @Fernando N Cruz There are lots of lenders that will lend to those that do not have a job. I have seen rates as low as 5%-6%. This is an option for you once you leave your job. For now however you will want to borrow as much as you can while you are still employed.

Good Luck!

How do I get approved on refinancing on a BRRR without an 8-5?

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