All Forum Posts by: John Friendas

I think I misunderstand DTI for rental incomes.

My DTI goes up with a cashflow positive rental ($2000 expense and $3,500 income). I used the 75% rule on the income and added it and my DTI without the rental goes from 24% to 38%.

Or does it just allow me to just take the net profit of that rental and add it to my rental?

As a person with an average salary, I was wondering what the maximum amount of DSCR loans a lender would give out would look like? I have one conventional mortgage and am looking for turnkey rentals, which there are many of in the midwest. How do I get to 5, 10, 20 properties with DSCR? And do they care if I do rent by the room strategies?

Originally, I felt limited by conventional lending DTI.

The downpayment and closing costs would be one large hurdle in order to repeat this, I'm not sure how willing lenders are to allow 3 properties a year. Still learning the DSCR ins and outs. Thanks!

 I would be thinking about future loans as I plan to do purchase another property soon after. Whereas he would be good with this for a while. What I'm aiming for are turnkey rentals and trying to max out the amount of conventional, lower interest loans.

 What would be the best way to go about it then? I make about 70k a year from my salaried job and my friend makes double that. I'm trying to make it so I'm on the deed/title and not the mortgage.

I know the income side would be effected with the dti I was just wanting the debt side not to be. The net rental income should be about 65% more than the mortgage.

Yes it is a blank slate and we are both open to making it work in whatever way necessary. He gets how much work managing it locally is and I get the benefit of having my DTI not effected.

Hey,

My investing partner and I have reached an agreement where he would have the debt under his name and apply for it individually, and I would do the majority of the management (he is out of state and my income is half his). Is there a way to do this commercial mortgage with a LLC where the mortgage would never show on my DTI?

It's a multifamily investment partnership and we will have a separate contract dividing everything else 50/50. Thanks for the help!

Do you know the degree to which they fought back on these inaccuracies?

It would definitely be fraud if this was the case, a recent post from an auctioneer talked about this exact situation, where they said the auctioneer was liable (different bedrooms/type of home example you don't have to read it) States would differ though and it doesn't seem black and white. https://mikebrandlyauctioneer.wordpress.com/2022/07/12/no-li...

I do agree with you that it could very well lead to being burnt, however. It would be on an auction site with pictures/a description of which each unit rents for.

 It does seem like it is such a significant misrepresentation though, I wonder if getting some confirmations in writing helps. Either way it would be a grey area, selling a house with a different amount of units/bedroom/bathroom seems extreme though.

 Thanks for the tips!

I was able to check an old listing and it showed it as being 2 units instead of 3 and one bedroom/bathroom less than what they are claiming.

Tomorrow I plan on having my pretty wife knock on a couple doors, hopefully she can talk to someone living there so we don't get something substantially different. I'll also check with the city on any potential liens, I think any inspection would have to be done after my $15k deposit so it would be a high risk, high potential reward type deal, and there is a 15+ bids already.

Hey,

I'm looking at an auction, with curbside buying only where you can't disturb the tenants. They claim it is a triplex (two regular units and an "efficiency unit". They also claim it has 6 beds and 5 baths. I only see 5 beds and 4 baths in the listing and do not see that third efficiency unit in the listing pictures. 

Considering it's from a reputable auction site, do I have decent legal standing if they misrepresent it? They say they are not liable for inaccuracies but the number of bedrooms, bathrooms, and unit amount seems incredibly major. Once you win the auction you have to put down a 15k deposit so I don't want to not have a chance of getting it back. The offer seems great numbers wise, possibly even without the 3rd unit.