Underwriter wants to count payment against me..

[Samantha Klein]

Let's say you show a $500 annual profit after deprecation on your rental property on your taxes, wouldn't the lender divide that $500 by 12 and add that to your monthly income? I'm trying to figure out how much to claim in expenses this year on 1 property because my lender is telling me that for example, if my mortgage payment is $456, I need to make at least $456 a month in profit on my taxes, and I have never heard of that. I always thought even if show a loss on your taxes, let's say $1,200, the lender would divide by 12 and use $100 a month added to your debt side, am I right or is the underwriter? The underwriter wants to count the whole payment against me...

[Chris Mason]

Hi @Natalie Kolodij,

The PITI and other actual expenses are accounted for when we subtracted them from gross rent, to arrive at our net income number.

That's why you can make a relatively modest income, own eleven properties with eight mortgages across them, and have your DTI (CORRECTLY calculated) be something like...

His DTI would be like 250% or something crazy if it was calculated how you were suggesting, which is in fact how some LOs will do it and then tell a REI that "your DTI is too high, you don't qualify"... well, yeah, because the math was done wrong. Their DTI is fine, it's the dang LO who is the one that isn't qualified.