When a bank looks at your rental income they accept 70% of the rents as usuable income. If your brother's rents are only covering the MTI then every house is slowly eating his debt ratio. You should plan on buying so your rents are high enough to keep your ratio acceptable for future purchases. I learned this when trying to purchase a REO property. Can he re-fi a few to get the ratio down?
About how many properties can you own before it becomes difficult to obtain bank financing? My brother has a few properties (all have positive cash flow) and he says it gets more difficult. What are your thoughts? I would imagine it should get easier if you are showing profits on your business to find bank investing but dont know if that is really the case. Thanks.
They key is to use small local banks that keep their loans in their own portfolio. Obviously, you need excellent credit and having a track record with the bank is also important.Mike