DTI Calculation Confusion

[Laleh Omaraie]

I have income from a W2, 1099s/Schedule C, and rental income on my house hack. Something about this seems to make calculating my DTI wacky; I know lenders aren't just adding up my gross income from all these sources and dividing my debts by that. However, I haven't found anyone who would break down for me how exactly they calculate it, then. My understanding is that it varies from lender to lender as well.

The difference between being able to use a 10% second home loan vs a 20% down DSCR loan would mean a big difference in how quickly I can purchase my next investment. Understandably, lenders don't want to crunch these numbers for me before knowing if I'm ready to apply for a loan… but whether I'm ready to apply depends on whether I can get 10% down or not. Sigh.

So how can I accurately calculate my DTI to determine once and for all what my options are? Any advice or suggestions?