rental income on non subject investment property

The underwriter will take actual expenses and income derived from the tax returns, however they will hit her with the full payment against her DTI.. Half owner or not.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

JD,The rental income is just calculated off of her schedule E on the 1040's. If she claims everything 50/50 then she would only claim 50% of the taxes, 50% of the rental income, depreciation, insurance, etc. Fannie is going to have you calculate everything off the schedule E to determine net rental income so just pull the numbers of her schedule E and you already have the 50% calculated into the equation. Then you are going to use that net rental income to offset the PITI on that property. If you are using Encompass there is a spot in there to put in the ownership percentage of the property. Put it at 50%. There is no way to exclude the PITI if she is an owner of the property and obligated on the current mortgage. I hope this helps, good luck.

JD, Take the income off of Sch E, add back the depreciation, mortgage interest, taxes and insurance and subtract the PITI. Positive number goes to income, negative number goes to liabilities. Your Underwriter will decide whether your borrower will be hit for the full PITI or not.