Tapping Into Portfolio Equity with a High DTI Ratio

[Kesete Thompkins]

I have a real estate portfolio with good amount of equity (most of the portfolio is free and clear), however my personal DTI ratio is too high and that's stopping me from tapping into it to settle some debts and buy more properties. Other than lowering my DTI ratio (which is what I'm focusing on now), is there another way to realize that equity or am I stuck with dead equity until I can get that ratio to a better space?

I'm open to any and all thoughts and ideas. Thanks in advance.

Kay

[Jay Hurst]

Quote from @Kesete Thompkins:

I have a real estate portfolio with good amount of equity (most of the portfolio is free and clear), however my personal DTI ratio is too high and that's stopping me from tapping into it to settle some debts and buy more properties. Other than lowering my DTI ratio (which is what I'm focusing on now), is there another way to realize that equity or am I stuck with dead equity until I can get that ratio to a better space?

I'm open to any and all thoughts and ideas. Thanks in advance.

Kay

Assuming your debt to income ratio is actually being calculated correctly and is still too high then a debt service coverage ratio (DSCR) would be your best bet. These loans only look at the income the subject property is bringing in.  However, I would be sure to understand what your real debt to income is before going to a DSCR loan. Do not try to do it yourself as most borrowers do not do as an underwriter will and they short change themselves. And unfortunately it seems a good % of loan officers do not know how to do it either. But, make sure you speak with someone who does before giving up on full doc.