Refinance troubles in the BRRRR method

[Andrew Halbert]

The next stage for our company is to utilize the BRRRR method. T

he question I have is around the re-finance part. When putting permanent financing on the property the bank is going to look at our credit/personal DTI etc. Our DTI is already pretty bad because of the amount of properties we acquired the past 18 months using conventional financing. I understand that I can't claim rental income on the balance sheet until it has been coming in for 2 years. So on paper my DTI is destroyed. Is the answer that I just simply have to wait until I can claim all my rental income as income, thus allowing my DTI to recover? Making it easier for financing?

Am I missing a step here? 

[Bryan O.]

@Andrew Halbert it looks like you ran into an issue. The biggest problem that isn't advertised in BRRRR is planning! You should have already lined up the financing before you ever found the property.

@Shaun Weekes is right, many lenders will simply take 75% of lease income, so if you have the lease handy you can increase your income and hopefully that is enough to seal the financing. The refi in LLC may also work, but remember that financing terms are typically much less favorable that way, and they will still check your personal information to put you as a guarantor.

Best of luck!