Maxed DTI. How should I get more properties?

[Eli Kim]

Hey guys, 

So I currently have 3 properties and I want to purchase another one but the issue is I've maxed out DTI. What other methods should I use to acquire another property? I've been thinking DSCR but don't they typically have higher down payments and closing costs? I was also thinking of looking for seller finance deals. What are you guys thoughts for my best course of action?

[AJ Exner]

Quote from @Eli Kim:

Hey guys, 

So I currently have 3 properties and I want to purchase another one but the issue is I've maxed out DTI. What other methods should I use to acquire another property? I've been thinking DSCR but don't they typically have higher down payments and closing costs? I was also thinking of looking for seller finance deals. What are you guys thoughts for my best course of action?

Down payment should be about the same (20% on a buy-and-hold) but you'll see an additional $3-$6k on average in CC and the ability to keep it off of your DTI/Personal credit along with hopefully no more hard inquiries on your credit (many lenders will accept/perform a soft pull).

[Kyle Allbright]

Quote from @Eli Kim:

Hey guys, 

So I currently have 3 properties and I want to purchase another one but the issue is I've maxed out DTI. What other methods should I use to acquire another property? I've been thinking DSCR but don't they typically have higher down payments and closing costs? I was also thinking of looking for seller finance deals. What are you guys thoughts for my best course of action?

We're in the exact same boat my friend. I'm currently getting under contract on a property for rent in Texas, our 4th, via DSCR.

Hoping it’ll be a successful move. 
P. S. I wouldn't worry about the higher dp because any investment property is going to require 20% down , like a DSCR

[Eli Kim]

Quote from @Kyle Allbright:

Quote from @Eli Kim:

Hey guys, 

So I currently have 3 properties and I want to purchase another one but the issue is I've maxed out DTI. What other methods should I use to acquire another property? I've been thinking DSCR but don't they typically have higher down payments and closing costs? I was also thinking of looking for seller finance deals. What are you guys thoughts for my best course of action?

We're in the exact same boat my friend. I'm currently getting under contract on a property for rent in Texas, our 4th, via DSCR.

Hoping it’ll be a successful move. 
P. S. I wouldn't worry about the higher dp because any investment property is going to require 20% down , like a DSCR

Let me know how that turns out! I know It differs lender by lender but I'm curious what CC's are like with DSCR. I was fortunate enough to find a lender with 15% down for my previous properties

[Kyle Allbright]

Quote from @Eli Kim:

Quote from @Kyle Allbright:

Quote from @Eli Kim:

Hey guys, 

So I currently have 3 properties and I want to purchase another one but the issue is I've maxed out DTI. What other methods should I use to acquire another property? I've been thinking DSCR but don't they typically have higher down payments and closing costs? I was also thinking of looking for seller finance deals. What are you guys thoughts for my best course of action?

We're in the exact same boat my friend. I'm currently getting under contract on a property for rent in Texas, our 4th, via DSCR.

Hoping it’ll be a successful move. 
P. S. I wouldn't worry about the higher dp because any investment property is going to require 20% down , like a DSCR

Let me know how that turns out! I know It differs lender by lender but I'm curious what CC's are like with DSCR. I was fortunate enough to find a lender with 15% down for my previous properties

 For sure, man, I’m sure it varies by state with Lending  but in Texas 20% down is  pretty standard on investment properties. Stinks. 

[Eli Kim]

Quote from @Kyle Allbright:

Quote from @Eli Kim:

Quote from @Kyle Allbright:

Quote from @Eli Kim:

Hey guys, 

So I currently have 3 properties and I want to purchase another one but the issue is I've maxed out DTI. What other methods should I use to acquire another property? I've been thinking DSCR but don't they typically have higher down payments and closing costs? I was also thinking of looking for seller finance deals. What are you guys thoughts for my best course of action?

We're in the exact same boat my friend. I'm currently getting under contract on a property for rent in Texas, our 4th, via DSCR.

Hoping it’ll be a successful move. 
P. S. I wouldn't worry about the higher dp because any investment property is going to require 20% down , like a DSCR

Let me know how that turns out! I know It differs lender by lender but I'm curious what CC's are like with DSCR. I was fortunate enough to find a lender with 15% down for my previous properties

 For sure, man, I’m sure it varies by state with Lending  but in Texas 20% down is  pretty standard on investment properties. Stinks. 

 How are the rents in Texas?

[Kyle Allbright]

Quote from @Eli Kim:

Quote from @Kyle Allbright:

Quote from @Eli Kim:

Quote from @Kyle Allbright:

Quote from @Eli Kim:

Hey guys, 

So I currently have 3 properties and I want to purchase another one but the issue is I've maxed out DTI. What other methods should I use to acquire another property? I've been thinking DSCR but don't they typically have higher down payments and closing costs? I was also thinking of looking for seller finance deals. What are you guys thoughts for my best course of action?

We're in the exact same boat my friend. I'm currently getting under contract on a property for rent in Texas, our 4th, via DSCR.

Hoping it’ll be a successful move. 
P. S. I wouldn't worry about the higher dp because any investment property is going to require 20% down , like a DSCR

Let me know how that turns out! I know It differs lender by lender but I'm curious what CC's are like with DSCR. I was fortunate enough to find a lender with 15% down for my previous properties

 For sure, man, I’m sure it varies by state with Lending  but in Texas 20% down is  pretty standard on investment properties. Stinks. 

 How are the rents in Texas?

 pretty good!

[Kyle Allbright]

Quote from @Kyle Allbright:

Quote from @Eli Kim:

Quote from @Kyle Allbright:

Quote from @Eli Kim:

Quote from @Kyle Allbright:

Quote from @Eli Kim:

Hey guys, 

So I currently have 3 properties and I want to purchase another one but the issue is I've maxed out DTI. What other methods should I use to acquire another property? I've been thinking DSCR but don't they typically have higher down payments and closing costs? I was also thinking of looking for seller finance deals. What are you guys thoughts for my best course of action?

We're in the exact same boat my friend. I'm currently getting under contract on a property for rent in Texas, our 4th, via DSCR.

Hoping it’ll be a successful move. 
P. S. I wouldn't worry about the higher dp because any investment property is going to require 20% down , like a DSCR

Let me know how that turns out! I know It differs lender by lender but I'm curious what CC's are like with DSCR. I was fortunate enough to find a lender with 15% down for my previous properties

 For sure, man, I’m sure it varies by state with Lending  but in Texas 20% down is  pretty standard on investment properties. Stinks. 

 How are the rents in Texas?

 pretty good!

 I'm in the metroplex/dfw so definitely good and virtually no vacancies as far as when they're turned

[Eli Kim]

Quote from @Kyle Allbright:

Quote from @Kyle Allbright:

Quote from @Eli Kim:

Quote from @Kyle Allbright:

Quote from @Eli Kim:

Quote from @Kyle Allbright:

Quote from @Eli Kim:

Hey guys, 

So I currently have 3 properties and I want to purchase another one but the issue is I've maxed out DTI. What other methods should I use to acquire another property? I've been thinking DSCR but don't they typically have higher down payments and closing costs? I was also thinking of looking for seller finance deals. What are you guys thoughts for my best course of action?

We're in the exact same boat my friend. I'm currently getting under contract on a property for rent in Texas, our 4th, via DSCR.

Hoping it’ll be a successful move. 
P. S. I wouldn't worry about the higher dp because any investment property is going to require 20% down , like a DSCR

Let me know how that turns out! I know It differs lender by lender but I'm curious what CC's are like with DSCR. I was fortunate enough to find a lender with 15% down for my previous properties

 For sure, man, I’m sure it varies by state with Lending  but in Texas 20% down is  pretty standard on investment properties. Stinks. 

 How are the rents in Texas?

 pretty good!

 I'm in the metroplex/dfw so definitely good and virtually no vacancies as far as when they're turned

 That’s good that’s good

[Matt Devincenzo]

How long have you owned these, and how much is rent vs the payment? If they are CF positive then they will not cohnt against your DTI but will improve it...that's standard conventional guidelines barring a few exceptions.

[V.G Jason]

Quote from @Matt Devincenzo:

How long have you owned these, and how much is rent vs the payment? If they are CF positive then they will not cohnt against your DTI but will improve it...that's standard conventional guidelines barring a few exceptions.

 If it's ITM, they are going to analyze it at 75% of it. So he needs to be more ITM than  the 1.25:1 ratio.

With that said, to answer the question-- figure out your debt or income. Start getting your situation less debt ridden by paying down or on your next investment put more cash down to make it highly intrinsic. 

[Jassem A.]

Seller financed deals. Offer to pay them off in 5-10 years at a higher interest rate. I know one person that did this recently and was able to negotiate no money down and 12% over 5 years but this was probably in the mid west. For more expensive properties you'll be wanting to pay a lower interest rate and doing short/mid term rentals.

[Steve Vaughan]

Quote from @Eli Kim:

So I currently have 3 properties and I want to purchase another one but the issue is I've maxed out DTI. What other methods should I use to acquire another property?

For conventional lending, my spouse and I bought each on our own.  I'd buy one, they'd buy the next.  

We also bought a lot with seller financing.   The most common asset type was commercial multis 7-10 units.  Tired landlords and conventional loans weren't available.   

Don't expect Jack and Jill homeowner to seller finance for you. 

[Whit B.]

Quote from @Eli Kim:

Hey guys, 

So I currently have 3 properties and I want to purchase another one but the issue is I've maxed out DTI. What other methods should I use to acquire another property? I've been thinking DSCR but don't they typically have higher down payments and closing costs? I was also thinking of looking for seller finance deals. What are you guys thoughts for my best course of action?

I ran into the same issue. I pivoted to doing creative financing. My last deal was an exact wrap at 3.5% granted I had to put $80k down to pull it off, but it’s a great way to keep the train on the tracks. 

[Jacob Schurer]

Quote from @Kyle Allbright:

Quote from @Eli Kim:

Hey guys, 

So I currently have 3 properties and I want to purchase another one but the issue is I've maxed out DTI. What other methods should I use to acquire another property? I've been thinking DSCR but don't they typically have higher down payments and closing costs? I was also thinking of looking for seller finance deals. What are you guys thoughts for my best course of action?

We're in the exact same boat my friend. I'm currently getting under contract on a property for rent in Texas, our 4th, via DSCR.

Hoping it’ll be a successful move. 
P. S. I wouldn't worry about the higher dp because any investment property is going to require 20% down , like a DSCR

Hey Kyle,

What are/have you been using for your DP on these purchases via DSCR?  and if you're re-financing after rehab, can you do it via another DSCR?

I've been searching for threads/experience purchasing via DSCR (using HELOC as down payment + rehab) and then cash out-refi at 6mo & pay off HELOC...am I missing something?

[Kyle Allbright]

Quote from @Jacob Schurer:

Quote from @Kyle Allbright:

Quote from @Eli Kim:

Hey guys, 

So I currently have 3 properties and I want to purchase another one but the issue is I've maxed out DTI. What other methods should I use to acquire another property? I've been thinking DSCR but don't they typically have higher down payments and closing costs? I was also thinking of looking for seller finance deals. What are you guys thoughts for my best course of action?

We're in the exact same boat my friend. I'm currently getting under contract on a property for rent in Texas, our 4th, via DSCR.

Hoping it’ll be a successful move. 
P. S. I wouldn't worry about the higher dp because any investment property is going to require 20% down , like a DSCR

Hey Kyle,

What are/have you been using for your DP on these purchases via DSCR?  and if you're re-financing after rehab, can you do it via another DSCR?

I've been searching for threads/experience purchasing via DSCR (using HELOC as down payment + rehab) and then cash out-refi at 6mo & pay off HELOC...am I missing something?

 Hey Jacob!

That sounds like a plan in my humble opinion. 
I ended up going hard money , then refi into a DSCR, after 1 HM payment.
I did use funds from equity, to purchase the 4th, which was UHF one refi’d into DSCR. 

Hope this helps and feel free to reach out!

[Otis Gathing]

Eli,

If I were you I would look into Subject Two, Land Contracts on Properties that are free and clear and Raising Private Money!

[River Sava]

Hey Eli –

Given your situation, DSCR loans could be a solid path, especially if you're aiming to expand your portfolio. Down payments on DSCR purchases can be as low as 15% right now, and as you noted, they don't impact your DTI. Happy to connect!