Debt-Income when doing cash out refi or taking a second loan
I must be missing something because I can't seem to figure out how people say that "take all their money back out" and invest it in another property. How do you qualify for another loan if you do a cash out refi or take out an equity loan and increase your debt? Yes your income goes up because of rent, but not enough to qualify you for a loan of the same size as when you had no debt and no rental income.
For example,
On a salary of $85000, mortgage loan calculators say I can afford a $368k house at 6.735% interest rate when $60k down (default). Mortgage + Tax and Fees is estimated at $2400/month. Say I can get it to rent for $2500/month...that would bring my income to $115000, but I would still have a debt of $2400/month for Mortgage, Tax, and Fees. At a salary of $115000 annd monthly debt of $2400, my purchase budget is only $184k. How do I purchase another $368k or more expensive home when I only qualify for $184k?