Mortgage

[Anonymous]

Hello, I have a credit dilema.  My credit report shows 2 mortgages, which is true.  One of the houses is being rented to my daughter and she pays the mortgage.  She will be buying the mortgage from me within 2 years.  How do I show that this mortgage is being paid monthly as a rental thus showing that I am not in debt as monthly payouts from my income.  I am trying to get a refi but I fear this is putting a ding on my credit score.  My credit score is vey low @ 613 even though I have no credit card debt.  I do have a car loan which I signed for with my significant other.  I am on SS only and one small retirement income amount.

[HoldingOntoHope]

You are not going to be able to show it as a rental on your credit report. But during the application process for the refinance their should be a way to document the rental income. I assume that you are giving receipts and claiming the income for tax purposes. If not it will be near impossible to document for the loan.

This post will probably get moved to the mortgage loans board since it has nothing to do with credit cards.

Edit: I forgot which board I was on.

[thrasher865]

I don't think this would hurt your credit score.  Your loan officer would ask you for documents to calculate your DTI ratio.  I believe if you have a year of documentation for the rental income, it can offset the monthly payment.

Someone else will have to chime in on whether multiple mortgages hurts your credit score.

[StartingOver10]

The lender will apply a formula to the rental your daughter pays. Generally the lender will deduct 25% from the rent for vacancy and collection plus deduct the expenses you have for the house for maintenance, taxes and insurance. Even if you prove the payments are made on time each and every month by your daughter, its a formula the lender uses.

 As to your daughter "buying the mortgage" she would have to buy the house and use her own mortgage for your mortgage not to count in your DTI.  So, if the rent your daughter pays is equal to the mortgage amount, then you will still show a liability (according to the lender) for your existing mortgage. If her rent payment were higher and after the deduction for vacancy and collection and other expenses you had a positive cash flow, that amount would be added to your income.