How can I get a loan with low income?

[Daniel Whitmore]

I had a discouraging phone conversation with a lender out of state in Provo UT, a market I am focusing on for my first deal.

The “investor friendly” credit union representative told me it would be a challenge for me to get a loan based on my current situation, outlined below:

1) I am an out of state freelancer and my $40K income last year is a summation of 5 different W2s.

2) My rent expense is almost 40% of my income (I live out of state in LA)

I will not accept “no” as an answer because I know I am good for the loan and can generate the income needed to make my monthly mortgage payment once I move to UT. About me:

- 802 credit score

- $0 debt

- $100K in the bank (70% tied up in stocks)

- My goal for Deal #1 is to buy a duplex and house hack.

- I want to finance using an FHA loan.

This would require me to move from LA to Provo. I would no longer be using 40% of my income for rent. But technically my income in Utah is $0 because I don’t yet have a job there.

The following questions are for those seasoned investor who started with just a few dollars and had to be creative with financing and also for any creative, investor-friendly lenders who would be kind enough to offer advice...

1 - Am I out of luck getting an FHA loan until I secure a W2 job in UT and have proof of income there? Trying to avoid moving twice.

2 - My family owns a condo in UT I could potentially move into as a last resort (it is occupied with a spare room). Could I use this point as leverage in obtaining loan I.e. $0 rent expense?

3 - In any cases, is it possible to obtain an FHA loan without proof of income? In my case, I have proof of income but it is out of state income.

4 - I’m trying to think creatively. I have 100% confidence I can get a decent job in UT and I am actively searching. Should I put investing on the back burner and focus 100% of my effort on finding employment in UT?

[Joshua Johnson]

@Daniel Whitmore when my wife and I were applying to buy our first property we were unable to use her income because she didn't have what they were looking for with consistent income (working as a private nanny) so we qualified based on my income alone.

Have you looking into getting a partner who had the income qualification to get the loan? This would need to be someone who trusts you a lot like a family member, or very close friend.