My boyfriend is a 100% disabled veteran who receives $6,500 per mo in benefits.  We live in Alabama and he pays no property tax on his home here as a disabled vet.  He owns his home here outright (value $350k). He ha...

Here are some common pitfalls I see for new investors from the private lending perspective:• Insufficient Funds: most lenders are going to be able to lend a first-time investor somewhere around 75-80% of the purchase price of an existing property + 100% of your estimated rehab budget (or an 80/100 loan, for short).

Two days ago it was an investor who created an additional LLC independent of the deed holder entity believing tenants could only sue the LLC where a contractual relationship existed. 

For your existing rental property, the net rental income from your Schedule E on your most recent return will be used in your DTI.

Consequently many inexperienced investors make investment decisions based on where they can afford to buy, not necessarily where a good investment thesis may exist. 

Fed's can talk all they want about "creating" however millions of homes, it changes nothing unless Harry Potter comes into office and shezams them into existence. 

@Jay HinrichsSorry, I maybe misstated...we negotiated it to cost the asset (house)zero...the taxes still existed, they were released from the property because our lien was so substantial of a loss via our first position there was no equity for them to stay attached to...did that make more sense?

In general they will add the ADU only if it is existing living space such as workshop, bunk house, office, etc.  

If you are looking for loans on real estate or a business lenders don’t necessarily care about the credit history of the LLC - they care about the performance of the asset and your creditworthiness since you will most likely have to sign personally.I have established multiple LLCs just days before closing on large loans for different assets, those particular entities barely existed and the banks did not care.If you are talking about pulling a business line of credit (like a HELOC, but against your business equity) then the banks like to see some history of revenue.

Something to keep in mind though is that with the DSCR it is a new mortgage which entails higher closing costs as well as paying off any existing liens.