Solutions to inaccurate DTI

[Aidan Mulligan]

In need of some help everyone, 

Here's the situation I have. I'm trying to get conventional financing for a SFR. The loan officer says everything checks out and is ready to write me the approval except my DTI is artificially high and told me I need to figure out a way to prove that it is lower.

My only debts are my car loan, my student loan, and my rent. I'm splitting a $2,100 rent (May 2018 - June 2019) between three people so $700 is my actual rent.

My DTI with $700 rent is 26% while my DTI with the full $2100 is 54%

Here comes the tricky part. My bank statements showing a $700 withdrawal each month don't include the first month because one roommate (not me) paid the full amount in the leasing office by card and the rest of us venmoed that person. My lender says because of that I can't prove twelve months continuous rent at $700.

Here's where it gets trickier. I would just wait one more month so I can have the twelve except my third roommate has gone back home instead of renewing the lease. The second roommate and myself signed a new lease for $1,800/month in a two bedroom. DTI now sits at 30% which is fine, but I'm afraid he's going to hit me with the "Come back in a year when you can prove a $900/month payment."

Options I've been told. Private lender, Hard money, wait until I can do a deal cash.

Would love some guidance. Thank you (Charlotte, NC)

[Jonathan Pflueger]

Talk to another loan office, or even better, talk to a local bank in your area. Loan officers are a dime a dozen and tend to tell you only what works for them. Loan officers, banks, credit unions all have their own unique overlays limiting or extending their loan options. With your situation it seems like you should be able to find a bank that will work with you instead of against you. 

Keep at it, even if you have to call all the local banks, credit unions, or brokers in your area!