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how do i calculate dti for investment property?

by rachelnguyenr77986 from Delano, Pennsylvania. Apr 27th 2015 Reply


Linda Wintersteen (Linda123)
#63 ranked lender in Arizona - 1,252 contributions

same as a primary all your monthly debts and both payments , primary and investment payment, with taxes and insurance , and most lenders want 6 months of reserves for the investment loan in assets..

Apr 27th 2015
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William J Acres (William_Acres)
#1 ranked lender in Arizona - 8,041 contributions

Typically, borrowers attempting to calculate their DTI will do it wrong.. in fact.. even some new loan officers cannot calculate DTI properly.. so, for this reason, calculating your DTI should be left up to the professionals. To calculate DTI, you need 2 main things.. 1) we need to know your income, and 2) we need to know the minimum payments associated with your debt.. For income calculations, it can be very tricky.. are you self employed? Hourly or Salary? Commissions? Bonuses? Child support? Un-reimbursed business expenses (IRS-2106)? Rental income? Dividends? The rules are different for all these types of income, so without looking at your tax returns, it's impossible to say.. For debt, lenders look at all the payments associated with your debt.. the outstanding balances are not near as important as the monthly payments associated with the debt.. Car loans, RV loans, Credit Card Payments, Student loans, other mortgage payments, but we also include HOA payments and assessments, child support payments, payments on judgments or tax payments, and we include the new housing payment including all the taxes and insurance. We do not count your regular reoccurring bills like utility payments, cell phone, car insurance, etc.. The lenders underwriting manual is pretty thick, and there are large sections that explain how to calculate income and large sections explaining which debt payments need to be factored in.. There is no simple answer to your question.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. William J. Acres, Lender411's number ONE lender in Arizona. 480-287-5714 WilliamAcres.com

Apr 27th 2015
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