Can I Use My Sub 2 Prop. Income for 1003 - Posted by Marc NJ

Posted by Jim Rayner on April 17, 2003 at 06:35:04:

Marc,

A couple of things to think about here.

  1. If the sub 2 properties are 1-4 units then only 75% of the gross income would be considered versus the debt service on these properties. this might be a negative on your debt to income ratio depending on the numbers.

  2. I wonder if I had the trust disburse the beneficiary a monthly distribution check if i could not list that as other income provided that I could prove it with copies of the checks. I say this only because technically the trust owns the property.

Can I Use My Sub 2 Prop. Income for 1003 - Posted by Marc NJ

Posted by Marc NJ on April 16, 2003 at 23:34:35:

I want to use my sub 2 properties income for use on a 1003 loan app. I have a mortgage broker that says that I should not due to the stipulation and he says that it would be impossible to explain that the deed is in my name (actually a trust) and the leins are in the old owners name.
I need the added income to lower my DTI. I have 6 loans in my name and over the last year I have acquired 5 Sub 2 properties. I just had my credit score increase from 580’s to 700’s , but my DTI is on the high side.
I know I should switch loan brokers, but other than that how should I explain the sub 2 income.
Thanks for the imput.
Marc NJ

Re: Can I Use My Sub 2 Prop. Income for 1003 - Posted by Nate(DC)

Posted by Nate(DC) on April 17, 2003 at 18:45:08:

I agree with GMann’s advice to go stated or No Ratio if the DTI is too high. With a 700+ credit score you are looking at a MODEST (maybe 50 bps) bump in rate vs. full doc. Worth the convenience, in my mind.

NT

Re: Can I Use My Sub 2 Prop. Income for 1003 - Posted by GMann

Posted by GMann on April 17, 2003 at 07:20:30:

I wouldn’t include the subject-to income. Just do a stated income or no income verification. It’s a little higher rate but it’s the cost of being self employed and not being able to proove income.

If your broker hasn’t offered this, then they are either too timid to tell you about a rate bump for stated/no income verf. or they aren’t the sharpest stick of the bunch.