75% allocated to rental income is correct, I think that I stated that above. With a full doc loan, they would like to see a signed lease, with a stated it may not be an issue.
Some lenders will request 1 or 2 additional forms from the appraiser to determine fair market rent for the property and operating schedule, which can cost an extra $50 or $100.
Absentee property ownership isn’t for everyone, nor would I recommend it on a tight budget. When small things go wrong, you need to pay someone to take care of them, it would be nothing if you lived nearby.
You cannot constantly drive by to check on things which would drive many people crazy. To me it’s not much different than owning a mutual fund. You are relying on your manager for both.
It’s hard to comprehend areas where a house is $125K, and many people cannot afford to buy, but there are renters in every market. It’s hard to pick the perfect area for a long term investment, but the depreciation write off and ROI potential works well for many willing to take the risk.
Although multi units can offer a better return, a single house can still be better than nothing.
It also allows you the occasional tax deductible trip to check on your investment.
Lenders are in business to loan money. Meet their criteria du jour and they will fund. The stronger you are financially, the easier it is to get funded, but it still takes jumping through hoops for full doc.
