All Forum Posts by: Shubham Porlikar

HI Shubham,

Typically lenders will lend up to 50% of your total gross income assuming no debt. The formula is pretty straightforward Total expenses/ total gross income = cannot exceed 50%. Typically I would run a stress test to assure what my max purchasing/borrowing power would be because there are multiple factors that could influence your borrowing power such as house market prices, rates, income, liabilities. It is important to have someone to fully underwrite your file and run multiple scenarios to assure what your best route would be @Carlos Valencia @Albert Bui

Not investment advice .  See below for general rule of thumb.

1. How Much Cash Do I Have to Spend?

Assess your liquid savings (cash, short-term investments) and allocate a safe portion for your real estate investment. A good rule of thumb is to use 20-30% of your savings, ensuring you keep enough for emergencies. This cash will go toward the down payment, closing costs, and initial property expenses. 

2. How Much Loan Can I Get Approved For?

Lenders will look at factors like:

• Debt-to-Income Ratio (DTI): Your mortgage payment might be around 30% of your gross monthly income. If your monthly income is $8,000, you could get approved for a mortgage payment of around $2,000–$2,500.
• Credit Score: For investment properties, a score above 700 is ideal.
• Down Payment: Investment properties generally require a 20-25% down payment, so for a $300,000 property, expect to need $60,000–$75,000 in cash.

Hi @Shubham Porlikar. Chronologically, I would suggest talking to a lender first to figure out how much you can qualify for. Alternatively, you can try and figure out your DTI (debt-to-income ratio), that should give you a general idea as well. Let me know if you need an introduction, happy to share with you my lender's info. Next is to explore what strategy (long-term rental, short-term rental, mid-term rental, fix and flips, syndication, etc...) fits your investing goals and then your location.

Best of luck and feel free to reach out if you have any questions!

@Shubham Porlikar

Welcome to BP! 

1. The cash you have to deploy (and what % of your savings that is) is completely up to you. 

2. You should contact a few lenders who will ask you to apply. This may be a soft pull on your credit, but it's worth it (in my opinion) to determine that question. 

Talking with a reputable lender will help you answer both of these questions, although the first is much more up to you and your comfortability.