Qualifying for FHA, DTI & Partners?

[Daniel Dietz]

Hello All, 

I have a few general questions about conventional loans - the lender I am planning on using who was refereed to me by another investor is out of town for a week or so. He IS very 'Investor Friendly' and does a LOT of rental loans. My only experience so far is non-recourse loans for my SOLO410K and Commercial Portfolio loans for properties I own in an LLC with my partners. We have a total of 26 doors so far.

I am wanting to buy some properties on my own now, and a few with a partner where we will just do TIC most likely. That partner will be bringing the funds for the down payment, and I will be doing all operations from locating, acquiring, placing and managing tenants, and minor repairs.

My first question is for ones that I would buy on my own and DTI ratios. I want to know if I am on the right track in my thinking. The last 2 years my income, which is on a K1 Partnership Form (I only own 5% of it) has average $3600 month. My current personal monthly liabilities for house, HELOC, and vehicle and one 0% interest CC are $1425 month, which it looks like it comes out to about 40% DTI.

The places I am looking at to buy would have a minimum of $1500 monthly income, and the payments, taxes and insurance of about $975. If 75% of rental income is used to 'qualify' that would be $1125 month, so it seems that I would be $150 month 'in the positive' so to speak. I am assuming that each place like this I bought would add $150 per month to my 'net monthly income', so it would actually make my DTI 'better each month'?

With a partner, his DTI is very low, around 20% or so. So I assume as we ''blend" our DTIs we would still be in good shape for this? I assume if we do this as partners, with both of us on the loan and deed, that each property would 'use up' 1 potential loan for each of us? If so, are there any ways around this through only one of us being on the loan, deed, etc.....

Thanks, Dan Dietz