How to finance a future Padsplit??

[Michele S.]

Hello there,

I believe is my first post so bear with me. I have been lurking on here forever, but just recently became a member so that I can access all the extras.

I am considering investing in a home to Padsplit, but not quite sure what the best structure for financing would be. There will definitely need to be a reno budget to, at the least add bedrooms, and I am looking to stay under 400k. I chatted with a lender about the DSCR loans and he said that Padsplit (room shares) would not technically qualify for DSCR although if it's vacant at the time of closing, it should be fine. I don't want to do anything questionable and want to come out of pocket as little as possible. I have a high credit score but I am also possibly over leveraged. I do potentially have access to private money if needed, and a 401(k). I am new to this idea and in the beginning phases, so I'm not even sure what other questions I should be asking. I do not want to fully apply for anything at this beginning phase since I have more research to do, so hoping I can get some help here.

Thank you in advance for your expertise!