Low dit ratio.

[Scott Buckner]

Hello. I have a general question I hope I can get some good advice from. 

I have about 100k Cash i want to invest and get started on real estate. Been doing lots of research and ready to get feet wet.  Here is the problem. I have a low debt to income ratio due to recent divorce and child support. But, in my mind, enough cash to get started. 

What are some good routes i can go to get renter history under my belt and raise DIT ratio so banks will lend me money for more debt houses or multi-family units?  

Should I buy, live in a year then rest out?  

Should I pay cash for smaller house to get started? 

Should I wait til market goes down?  

Please help, any advice is appreciated. 

Scott in dfw.  

[Lance Wakefield]

Sounds like you have a high debt to income ratio, not a low debt to income ratio. Banks like to see a low not a high. So the best way to change your dti is to simply lower your debt or raise your income. 

Example if you make $5000 a month and have $4000 a month of bills your dti is 80% If you can add $1000 a month of income your dti will change to 66%. EVEN BETTER if you can lower your monthly bills to say $3000 a month and maintain an income of $5000 you will lower your dti to 60% 

So a house hack could be an awesome way to lower those monthly obligations. A 4 plex can often put out enough money to both add to your monthly income AND drop your monthly living expense. 

Best of luck