Money is the problem...

[Melissa Kirchhoff]

Isn't that always the case?

So I have a fun situation. I own a house and I have excellent credit and make a reasonably decent income. The problem is that I am a joint tenant with someone who does not have those things. She's having trouble sort of finding her way and struggling with debt and is self-employed with a very low income (hence the debt). We split everything, the mortgage and taxes, everything.

I'm ready to get started in investing, the problem is the loans. I can't get anything because of my debt to income because they consider me paying everything myself (mortgage, taxes). We are both afraid of not being able to sell the house for what we originally went in wanting to get out of it, and she's also afraid it won't be enough for her to get a loan for her next purchase. Finally, I had the idea to take out credit against my house but then realized that probably means re-creating a loan, basically, including her financial situation.

So now I'm back to the drawing board (working my *** off to try to save cash to buy these properties). But I feel a tiny shred of hope still. There has to be a way. Does anyone know a way to refinance or take out a line of credit against the house that doesn't involve basically a new credit check? Or is there some other route for me besides just cash? Please, someone give me hope! Thanks!

[Emily Lopez]

Originally posted by @Melissa Kirchhoff:

So now I'm back to the drawing board (working my *** off to try to save cash to buy these properties). But I feel a tiny shred of hope still. There has to be a way. Does anyone know a way to refinance or take out a line of credit against the house that doesn't involve basically a new credit check? Or is there some other route for me besides just cash? Please, someone give me hope! Thanks!

Alright, this might not be the answer you want to hear. There is hope but I am going to advise you to keep busting your butt and saving cash.  Most investors have been where you are now, seeing the value of real-estate investing but not quite being in a place where it is a viable reality.  Just 2.5 years ago my husband and I owned a small home that we were living in with a value of about 130,000.  We also had a ton of student loan debt about 75,000.  We had both just barely started our real jobs after graduate school.  Because of our debt to income ratio (home and student loan debt), even with great credit, we could not qualify to buy a home. Not just a cheap home, we didn't qualify at all for anything. Mortgage brokers were beyond rude to us. I made a vow, that when I went back in a better position, I would never give any of them any of our business. 

I would daydream about investing and research and keep my eye on houses.  I got so restless waiting and saving and waiting and saving and feeling like I would never be able to purchase an investment property.

I've always been frugal but working to pay of that much student loan debt created a spark in me that I would have never otherwise had. I worked extra jobs and paid every extra penny to the debt to lower our debt to income ratio.  I saved up cash on the side to buy an investment property so I had to find a balance between paying of debt and saving cash.  I deprived myself of so many fun things, times, experiences. I hustled hard.  I worked my full time job as a probation agent, coached gymnastics, sold things on ebay, and did taxes during tax season(I'm currently going back to college online part time for accounting).  I had so many jobs and almost NO free time.  My husband calls me the humming bird, he says if I stop moving I'll die.  But I busted my ***.  (This is important because a lot of people want it, but don't want to do what it takes to get it).  I have had friends that want to invest in rental property and ask for advice but they're not working hard to set aside capital and still have zero properties.  

Fast forward 2.5 years later. We now own 4 homes total (one of which is two units) counting our primary home, so we have four rental units.  We still have a long way to go, but we went from not being able to be approved for a home to where we are now in such a short period of time. Simply from busing my ***.  

There is no quick or easy answer but it IS POSSIBLE and there IS HOPE.  Work hard, bust your ***, and when you get exhausted, KEEP GOING.  Eventually, you will get there. But you have to save capital so you are not entirely dependent on others.