Portfolio/Small Bank vs Conventional Financing Re: Income

[Mehran K.]

Hi everyone,

Do small banks/portfolio lenders have the same underwriting requirements regarding rental income as fannie/freddie? ie. 2 year schedule E rental income on tax returns.

I have $1550/mo (with rental agreement) from roommates in my primary residence for 1 year. This is on my schedule E for 2012. Beside not having 2 years schedule E, conventional guidelines don't accept personal residence income unless its atleast a duplex.

I am closing on a property on April 5th (conventional financing) that has tenants in place (with leases) for $1075/mo. Conventional guidelines won't accept this income until 2014 (after 2 years schedule E)

For the next property I won't be able to get conventional financing until 2014

Does anyone know if the portfolio lenders/small banks, that write the 20 year amortized loans with 5-7 year balloons for investment properties, would consider these rental incomes right now?

Or do they not even care about my DTI, and lend based on the performance of the property? I'm into 1-4 unit residential btw.