I own a business and want to get a mortgage in the next year or so. Right now I have a 20k business loan for a startup company that is now taking off and making great revenues/profits. I also have 100k in student loan debt. Also have about 3k in credit card debt.
My current front-end DTI is 30%
I would like to decrease my DTI, so one thought I had was to get a business consolidation loan that is listed under my company’s credit profile (and not my personal profile) and then use that business loan to pay off all the loans that are listed under my credit profile. That should decrease my DTI by a good amount and the new loan won’t be listed under my name.
I currently pay myself as a W2 salaried employee of the company.
If I go this route, will it work to decrease my DTI or will the underwriter use the business loan as part of my personal DTI ratio? I don’t want to go through this process unless I can be sure that it will wipe off the debt from my personal credit report.