Los Angeles, CA · Member since 2019 · 11 posts · 3 votes
Hey BP community!
My wife and I live in LA and are looking at buying real estate. We've got a decent chunk of liquid reserves and credit scores above 800, but we can't get a loan because our income from 2020 and 2021 was largely from unemployment. Any advice on where to start? We're pre-approved for a DSCR loan but it would mean an interest rate above 8% and putting in a large chunk of our cash into one home. Would it be better to buy an investment property in a different market to generate income first? Are there other strategies?
My wife and I live in LA and are looking at buying real estate. We've got a decent chunk of liquid reserves and credit scores above 800, but we can't get a loan because our income from 2020 and 2021 was largely from unemployment. Any advice on where to start? We're pre-approved for a DSCR loan but it would mean an interest rate above 8% and putting in a large chunk of our cash into one home. Would it be better to buy an investment property in a different market to generate income first? Are there other strategies?
Thanks,
Moses
In the overwhelming majority of cases, if enough documentation is gathered, etc, base salary (or hourly pay if you consistently work 40 hours/wk) can be counted at 100% of value right away. So I'd suggest starting with a job.
Pragmatically, you need to figure out what's more important to do first.
If buying the house right away is most important, go get that boring W2 job. And start the entrepreneurial thing a day after you have keys in-hand.
If being entrepreneurial is most important right away, go for it. And buy the house after you've got that income on 2 years of tax returns.