bank financing

[haynesm]

About how many properties can you own before it becomes difficult to obtain bank financing?

When you use the word “own” do you mean “own it outright with nothing due on it” or do you own it with the bank - as in financing it.

@EZLoanz post:4

FYI—75% of rental income can be used towards income qualification…

@gsuidiot post:2

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?

My situation. I own a few properties (mostly small ones around 25K and some empty land) All are paid for, no money owed on them. only have one rented at this time. I know, what are you doing, why arn’t they rented. I’ll get there. I went to a bank and was checking on possibilty of renting some money from them but loan officer said he couldn’t rent me any money cause of my properties. Had too many and no income from them. Went to another bank and they said they had no problem with renting me some money. However their cost was much higher. I don’t understand, If I don’t owe anything on my properties what does it matter if they are rented out or not. And i have no trouble paying the taxes on them. No other monies due on them. Next time should I just not mention anything about having properties when fillingout a loan (rent)application at the bank. Would there be any thing legally wrong by not mentioning some of my properties.

[haynesm]

Well, I can see I didn’t do this right;. I wanted this to be in the thread from hugh0999 about bank financing but this computer sure is a mystery to me.

[propertymanager]

Well, I can see I didn't do this right;.

That’s ok. In the future if you want to post a reply in an existing thread, just hit the REPLY button at the top of bottom of the thread.

The bank doesn’t want to loan you the money (or charge you a high interest rate), because with the properties vacant you don’t have any income from the property, but will have the expenses and the loan payment from whatever loan they make to you.

Most banks require a personal financial statement for a commercial loan. Failing to disclose the properties you owe could probably be considered loan fraud.

Why don’t you just rent the properties? Do they need maintenance to be rentable?

Good Luck,

Mike