Qualifying off rental income/no DTI requirements

[Michael Masterson]

Hello everyone, 

I am a relatively new landlord (less than 5 years) with a fairly successful duplex that is fully occupied. I recently closed on a HELOC (on this property), and have a fair amount for a down payment in cash reserves. The issue I will likely come into with conventional financing is DTI requirements. I have over 2 years of property management experience, but Sched E only shows rental income for one of the units.

The area I am looking in consists of 2 types of properties. Turnkey beautifully renovated multifamily which demand high(er) rents, or fixer-upper multifamily which are either vacant or occupied by lower end tenants. 

My thought is I would be able to find a loan that would qualify me off what potential rent would be (if vacant) or what the rent is currently if occupied on a fixer-upper. If I can find a lender who lends this way I'd be able to get 2+ fixer uppers as opposed to dumping all my cash to buy the beautiful property. 

I'm capable of fixing the property myself as I did with my current duplex. But obviously as you begin adding liens to your profile DTI gets in the way.

Any younger investors in a similar situation? Or veterans who started out this way?