Higher loan amount: high salary w/ debt vs low salary no debt

[Kristoffer Dayrit]

Hello BP,

My brother and I are planning on purchasing a multifamily with an FHA loan to house hack. My brother has a constant monthly salary (web developer), whereas my monthly salary is more random (restaurant server). My brother also has debt, whereas I am debt-free. My question is which of us should apply for the loan to get a higher loan amount.

Me: Monthly gross income: $2500

Computed Debt Ratio: 0 (no debts)

Credit Score (Transunion): 625

My Brother:

Monthly gross income: $5000

Computed Debt Ratio (using https://www.mortgagecalculator.org/calcs/debt-ratio.php): Frontend 19.5%; Backend 45.66%

Credit Score (Transunion): 667

So which of us should apply for the loan to get a higher amount? Also, would either of us cosigning for the other help?

[Chris Mason]

Originally posted by @Kristoffer Dayrit:

Hello BP,

My brother and I are planning on purchasing a multifamily with an FHA loan to house hack. My brother has a constant monthly salary (web developer), whereas my monthly salary is more random (restaurant server). My brother also has debt, whereas I am debt-free. My question is which of us should apply for the loan to get a higher loan amount.

Me:

Monthly gross income: $2500

Computed Debt Ratio: 0 (no debts)

Credit Score (Transunion): 625

My Brother:

Monthly gross income: $5000

Computed Debt Ratio (using https://www.mortgagecalculator.org/calcs/debt-ratio.php): Frontend 19.5%; Backend 45.66%

Credit Score (Transunion): 667

So which of us should apply for the loan to get a higher amount? Also, would either of us cosigning for the other help?

Non-occupant cosigners don't do you any favors in terms of FHA down payment requirement on a 2-4 unit.

Apply together, ask your lender to work it up individually for each of you, and jointly as occupying coborrowers. No reason not to get all 3 options, since it's the exact same paperwork required on your end.