Real Estate
Sponsored by

Debt to Income Help With Rentals

1,565 Views | 3 Replies | Last: 3 yr ago by Comeby!
FinMick
How long do you want to ignore this user?
AG
Dumb question...

If I have multiple rentals that cashflow, or are a small loss on paper--how does that impact my debt to income ratio for new properties?

Say a (1200) loss for 2019 on my tax return--is that a $100 added to my debt portion of the calc (per month) vs. the mortgage payment that shows up on my credit report, or is it $100 on top of my mortgage payment?

Looking to add one ore property, and not sure if I should (or could) finance or just pay cash.
Kurt Gowdy
How long do you want to ignore this user?
AG
Do you get positive if you add back your depreciation? What about adding both depreciation and interest back?
FinMick
How long do you want to ignore this user?
AG
Yes, it's positive if you add back depreciation. More so if you include interest.
Jay@AgsReward.com
How long do you want to ignore this user?
Sponsor
AG
Yes, you add back deprecation, and the deductions for taxes, insurance and mortgage interest on the last two years of filed tax returns. Unless you have large maintenance expense or vacancy during the year the add backs typically at least break even on the rental income.
Comeby!
How long do you want to ignore this user?
AG
Does anyone have good rules of thumb on monthly cost to own a rental vs monthly rental income. I'm speaking primarily to VRBO or management company daily or weekly rentals and not landlord/tenants. Other than the normal, stay cash flow positive, What's typical? Are there occupancy or rental rate metrics? What constitutes a a good rental
property. Case in point, we have looked at beach houses in Florida and SPI and I suspect the only one that make money are the realtors and brokers. It is good enough to break even because renters as essentially paying for your mortgage? If we are looking at depreciation to make the math work, it sounds like it may be a loss. Thoughts?
Refresh
Page 1 of 1
 
×
subscribe Verify your student status
See Subscription Benefits
Trial only available to users who have never subscribed or participated in a previous trial.