How do I build my portfolio??

[Randy Marshall]

I'm on the verge of doing my first deal, purchasing a condo unit as a rental. I've run the numbers every which way and it's a great first deal for me. My lender is running the numbers and he needs my DTI to be no more than 45%. I have a car payment and mortgage with my wife. My DTI with all that is at 46%. When I do my taxes, I am going to try and structure my real estate expenses (I'm an agent) to show some income which will put me just under that 45%. Question is, how the hell do people purchase so many units and build a portfolio? They likely have a mortgage (primary residence), car payment, then they'll have investment properties with mortgages most likely. So unless they're not taking the investment property deductions and claiming lots of income, it seems nearly impossible to purchase more and more units. Can someone please explain how to build a portfolio of properties with a lender?

[Jeff B.]

SFRs use conventional loans, your credit & the DTI methods.

MFUs 5+ use commercial loans, and the property supports it self as seen in the DSCR number.

So how do you grow a portfolio? Transition a couple of SFRs into an MFU 6-8 units to change the rules:) Once you have one such, you can go back to a SFR if you like (but you'll soon adapt to the MFU). Collect a couple SFRs and replicate the transition :)