Back to the basics! Remind me...

[Aaron J.]

I need to be reminded again of the basics of the property acquisition investment concept and how it works. 

But let's say I buy the first investment and rent it out and cashflow between $100 to $300 a month. How is it that I will qualify for conventional financing for the NEXT investment if my debt to income ratio is at it's max? Will the bank view the rental income as qualifying income?

If they do then I can assume that will bring my debt to income ratio back to within the required lending guidelines again then allowing me to apply for more credit for the next investment?

How does the 20% down payment factor in to this on each investment property? How long is it going to take me to save up 20% on average in between investments? (Assuming the average purchase price is between $250k-$350k based on frugal living and a $40k a year job)

Also, if I am to rely on pulling equity out of the previous investment to get into the next investment, wouldn't that just push my payment up on investment I just pulled the equity out of thus cancelling out any profits?