Low salary mortgages for rental property!

[Kyle Pelech]

Happy New Year!

So I am starting a new job and looking to buy my first property. It is within the government sector and I will be starting at around 42k a year in NJ. Slow increases until I reach around 120k after about 10 years. I know I will not be making much money at first but I am looking at some great properties in my area. For example how much trouble would I have trying to get financing for a 350k - 400k house? It is a property with 3 separate units, I would be living in one. I would like to take advantage of the FHA loan if possible in my situation and have my father co sign for me. Does this price seem out of my reach?

Unit 1 generates $1100.00 month

Unit 2 $1000.00

Unit 3 $1400.00

Thank you!!

[Wes Brand]

Banks typically look for Debt to income ratios of 36% or less due to regulations about which loans can be resold. If it's a portfolio loan you can mess with that a bit. If it's for investment purposes and you have a different primary residence banks will count the income from the property towards the DTI calculation.

So, based on your 42k/year number, you can probably convince a bank to lend you up to somewhere around 240k in mortgage debt(a bit lower because they're going to count taxes and insurance in the DTI number), assuming you have no other debts.