Why is DTI so hard to overcome?

[Grayson Gist]

Hey,

Long story short is that I’m trying to buy a second Fourplex and lender’s are quick to say no.

I currently own one SFR in Oklahoma, and one Fourplex in Kansas City that I owner occupy. My wife and I are trying to buy another Fourplex to owner occupy and banks are giving us a hard time about DTI.

I looked everywhere and read a few books and can’t seem to find the missing puzzle piece.

1. All the properties cover the mortgage and then some.... even when I am (and will) live in them.

2. I have about 1.5 years so far of “landlord” experience but only partial year reports on my tax return.

3. My W-2 job is about $80k a year.

I’ve heard the lender should just add the difference (positive or negative) to my income and not count the mortgage to my debt.

But I've also heard they take 75% the rent -PITIA and include the debt. So every property that would "break even" with that puts that DTI as 100%. Am I missing something?

Thanks!