- 1st deal - Should I have co-signer?

[Jordan Hamilton]

Hi everyone,

I have spent the last 6 months saving about 60% of my income so I could finally move forward with my first multifamily property. I saved 30k and plan on using FHA loan to house hack one of the 4 units (looking at a 4plex). I recently went to a mortgage lender and asked for a pre-approval. After sending personal and company tax returns he said because I am self employed for 2 years and my tech company "reported" a loss on our federal tax return for 2017 and 2018 my personal income wasn't high enough to be approved for the property I want (listing price 320k). Keep in mind I am buying real estate that will cash flow and will hopefully increase my income in years to come. Only went to this one lender called CapHouse Financial for the pre-approval who was highly recommended from Sotheby's.

In my mind I have a few options. Pick 3-4 lenders and apply for a mortgage approval all at once and see if I get approved. If I don't get approved maybe have someone who does meet the requirements sign with me? What are the negatives to having a relative or business partner sign (just for mortgage approval and not financial reasons)?

I'm not giving up!

[Ed Groussman]

You cant move forward with an FHA loan application with multiple lenders simultaneously. There is an FHA case # thats issued and linked to the property.

Can use 75% of the projected rental income to qualify as income, but it may not be enough if you are reporting losses.

A coborrower would also need to reside in the property as your max LTV is restricted to 75% if using a non occupying coborrower for a multi unit FHA loan.

I can take a look at your file  if you need another set of eyes to review. Its possible that the other lender didn't analyze your tax returns properly and didn't add back certain deductions such as depreciation to your qualifying income.

Shoot me a message if you'd like. I'd be happy to help