Pre-approval: Seeking advice

[Dylan Kostak]

To quickly discuss my situation, I am in my final semester of college lacking the proof of income to qualify for a loan. I'm looking to BRRRR and have a private lender lined up ready to fund my first deal. I have not searched for pre-approval yet as having no income will be a major red flag for loan approval and that is why I am posting here to see if anyone has recommendations.

Should I form an LLC and search for portfolio lenders willing to lend to the entity and not base loan approval on my current status?

In June, I have a position lined up as a registered nurse solving the stable income issue, I already have a +700 credit score, but I'd still be missing a solid employment history. Maybe this information can guide some of the recommendations.

Any advice is much appreciated. 

[Michael Glist]

So I would suggest talking to a local lender to see if they would need the employment history. You should be able to use schooling as history since you are getting a job in the field that you went to school for. They should also be able to use you offer letter to help with pre-approval. Some lenders may ask for a few paystubs prior to closing but that would be something to discuss with the lender. 

If you are unable to qualify due to you DTI Ratio (Debt to Income Ratio) since they will be qualifying you based on your new mortgage plus your current residence expenses that you would want to look for a DSCR lender. They will qualify you based on credit and the properties ability to generate enough rental income to cover the mortgage, taxes, insurance etc. They may require an LLC but you would want to check with them first before setting one up.

I hope this helps. Fee free to reach out if you have any additional questions or need any clarification on anything I mentioned.