Buying 1st Investment Property Next Q3-4, Will Taking out business credit card affect
Hello BP Community,
I am looking to purchase my 1st investment House-hack multifamily property this year in Q3-4. I justed wanted to know if it makes sense to take out a business credit card for my business ? Appreciate your responses in advance.
Yes that is probably a smart move. Most business credit cards do not report on your personal credit report so often times any debt associated with the business credit card will not impact your debt to income ratio.
Make sure to ask the bank if they will report the business card to your personal credit report. Some banks o and some banks dont.
Quote from @Eric Veronica:
Yes that is probably a smart move. Most business credit cards do not report on your personal credit report so often times any debt associated with the business credit card will not impact your debt to income ratio.
Make sure to ask the bank if they will report the business card to your personal credit report. Some banks o and some banks dont.
Thank you @Eric Veronica. Would it be ok to refinance a vehicle that i cosigned on for a family member. Im assuming getting a lower refi rate would lower payments also improving my DTI Ratio ?
@Adoney Reid are you planning to buy this as a primary residence and house hack or buy as an investment property? 2 different things. If buying as a primary then the lender will be looking at your personal credit. If buying as an investment and not planning to live there, different story.
As far as taking out a LOC I would make sure you take it out in the LLC or entity you plan to use to purchase the property with so you have some business credit seasoning under your belt. Although business cc don't report against your personal credit you still want to make sure your personal DTI is good, they're going to look at that too unless you're planning to do like a DSCR loan in which case they usually won't. You'll have to put down 20-25%
Getting the vehicle off your DTI will definitely help, see if your family member's credit is good enough for them to refi you off the loan.
Adoney,
Use DSCR Loan program: No Income & No Debt Ratio!
As a Direct Lender, (meaning the actual lender underwriting the loan and not a mortgage broker), DSCR program looks for good credit payment history, good credit scores, and validates your available accessible Cash for the Down Payment.
You can close under a new LLC.
First Time Real Estate Investors eligible with qualifying previous Homeownership history.
The loan program qualifies the property by using Rental Income to cover the Total Mortgage Payment which includes Taxes, Insurance, and HOA.
Regards,
Michael Taylor
@Adoney ReidSure that wouldnt hurt
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Quote from @Adoney Reid:
Hello BP Community,
I am looking to purchase my 1st investment House-hack multifamily property this year in Q3-4. I justed wanted to know if it makes sense to take out a business credit card for my business ? Appreciate your responses in advance.
This would depend on if the business card reports on your personal credit. Lenders will factor in your minimum monthly payment on the balance of the card.
Are you making any monthly payments on the auto loan? If not, then providing proof that the payments are being made by someone else, will certainly help your DTI ratio
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Lender California (#02161719)
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Quote from @Steve Meyers:
@Adoney Reid are you planning to buy this as a primary residence and house hack or buy as an investment property? 2 different things. If buying as a primary then the lender will be looking at your personal credit. If buying as an investment and not planning to live there, different story.
As far as taking out a LOC I would make sure you take it out in the LLC or entity you plan to use to purchase the property with so you have some business credit seasoning under your belt. Although business cc don't report against your personal credit you still want to make sure your personal DTI is good, they're going to look at that too unless you're planning to do like a DSCR loan in which case they usually won't. You'll have to put down 20-25%
Getting the vehicle off your DTI will definitely help, see if your family member's credit is good enough for them to refi you off the loan.
Thanks for your response @Steve Meyers. I will be buying as my primary residence and house hacking it. My family member I co-signed for doesn't have good credit at the moment so any refinancing would have to be under my name. Any business credit I do take out will be under the LLC and ill make sure the lender doesn't report to the consumer reporting bureaus
Quote from @Erik Estrada:
Quote from @Adoney Reid:
Hello BP Community,
I am looking to purchase my 1st investment House-hack multifamily property this year in Q3-4. I justed wanted to know if it makes sense to take out a business credit card for my business ? Appreciate your responses in advance.
This would depend on if the business card reports on your personal credit. Lenders will factor in your minimum monthly payment on the balance of the card.
Are you making any monthly payments on the auto loan? If not, then providing proof that the payments are being made by someone else, will certainly help your DTI ratio
Understood. Thank you @Erik Estrada