Lots of property equity: Debt to Income Ratios

[Anne Whalen]

Hi BP Bay Area community. New investor here. I am trying to figure out the best way to leverage lending to buy additional properties. I have 2 properties with lots of equity (estimated: 800K). I looked into conventional loan, HELOC and cashout refi with Wells Fargo and was told that my debt to income ratio is too high (hubs is W2, I am 1099). I read that each lender have different criterias? Is that true? Anyone have recommendations for Bay Area local lenders?

[Account Closed]

@Anne Whalen,

Given your circumstance, Wells Fargo is the last bank you want to go to. You don't fit in their lending criteria box, and the loan officer there probably doesn't have enough knowledge or was just too lazy to work on your scenario. 

You need someone like @Chris Mason who would spend sometime to get to know your finances and give you the best recommendation. I've heard good things about Bay Equity. I can also refer you to my loan officer and see if he can help you out. He works for Homestreet Bank, a portfolio lender, in Pleasanton. 

Instead of leverage to the hilt, the option I like best is to pay-off your primary residence. Then put a HELOC on it. The money is there when you need to tap it. Why have your money sitting in the bank collecting 0.25% when you're paying 3% interest on your primary?

Everyone's financial circumstance is different so working with a good loan officer/lender is a MUST to help you get to where you want to be. 

Happy hunting!