For those of you who have lines of credit set up to fund your GP commits, do you have to disclose this as debt when applying for a mortgage to buy a house/apartment?
The GP commit loan balance can get pretty big so wondering if this can impact one’s ability to get a mortgage.
Based on the most helpful WSO content, yes, GP commit loans can impact your borrowing ability when applying for a mortgage. These loans are considered debt and would typically need to be disclosed as part of your financial obligations. Mortgage lenders assess your debt-to-income (DTI) ratio, credit score, and overall financial profile when determining your eligibility. A high GP commit loan balance could increase your DTI ratio, potentially affecting your ability to qualify for a mortgage or the terms you are offered.
If you're concerned about this, it might be worth discussing with a mortgage broker or lender to understand how they view such obligations and whether there are strategies to mitigate the impact on your mortgage application.
Sources: How do all the smaller GPs handle the funding to closing process?, The Great Deleveraging | The Daily Peel | 7/18/2023, https://www.wallstreetoasis.com/forum/real-estate/starting-your-own-shop-lp-debt-fund-vs-gp-dev-co-value-add?customgpt=1, GP vs. LP Day, GP vs LP - Which is better
Bump.. Does anyone know?
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