Real Estate Investor · Callahan, FL · Member since 2014 · 17 posts · 1 vote
I am working on getting my second rental ready that I am currently living in. I want to be able to move out of this home and get another. In July my first rental will have 2 years of tax returns.
Does my first homes rental experience also mean I could potentially add my second rental's income to my income when calculating debt to income ratio for a conventional home loan on my 3rd property I plan on living in even though I have only owned it for one year and haven't had it rented yet?
Allentown, PA · Member since 2014 · 264 posts · 120 votes
9y
Every bank would be different, I would think that a small local bank would work with you on this, you should call them and talk to them about your plan.
Lender · Denver, CO · Member since 2015 · 404 posts · 227 votes
9y
@Ryein Goddard You don't need two years of experience to count rental income. You will be allowed to count rental income from your current primary if you can show a signed lease for it during the process of purchasing your next home. Many lenders will also want to see that the security deposit has cleared into your account. You need to find a lender who understands investments and has no additional rules (overlays) on top of Fannie Mae.
Lender · Fort Worth, TX · Member since 2016 · 8k+ posts · 6k+ votes
9y
@Ryein Goddard just one quick addition here: yes, you can add your first, second, and 3rd income to your calculation. When buying a rental property sometimes it's not rented so the appraisal that you order with the lender will have a "rental comparison report" that will show what the market rent will be for that next property and that's the rental income they will use. In theory, your "debt-to-income" should always be BETTER with the more properties you buy. Since we only buy properties that cash flow, the more cash flow we have the better. You can even buy multiple properties at the same time....as long as you have the down payment money for this. Good luck with your next house!