75% of monthly rent is added as debt?

[Samantha L.]

I own one rental house. I owe 60k on it and it rents for 675/MO. My husband owns our primary residence. We owe 125k and it is valued at 170k. We applied for a 40K HELOC to finance our next rental under that house. My husband dealt with the entire process and just plugged my information in for me. When they ran the numbers on my end, they told him that my debt to income was too high because of my rental because not only does my 60k loan get figured into my debt but also 75% of my monthly rent is added into my debt. I have tried getting him to explain this to me more because it doesn't make any sense to me. I keep thinking that there much be something that we are missing. I understand not counting 100% of rent as income due to potential vacancies and repairs. However, how it comes out, they are essentially counting 100% or more of my investment as debt. We ended up securing the financing by removing my name from the application. However, now I am left wondering how, under those conditions, we continue to build, if 75% of every investment is considered debt... on top of the loan used to finance it? Does this sound correct? Is there something that either he or I is missing? Perhaps this particular lender just has very tough conditions? I was hoping someone could explain this rule and their experience with it?