If I buy a property by having it seller financed, does that mean I have instant equity of what the value of the property is worth?
Will the bank see it as another mortgage against my debt/income ratio?
Yes it is looked at as any mortg would be looked at
You owe that money
Thanks for the reply @Michael Plante
@Gabriel Welch The bank will see it as a mortgage as it is a lien against your property i.e. it will be harder to get financing against the equity portion.
But, in all likelihood, this will not be reported in your credit history and should have minimal bearing on how much you can finance in the future (not including the effect of paying the existing note to the lender).
The equity is the difference in what you owe vs the value. The lien should be recorded against the property on the deed. The bank will see this, but it will probably not see it on your credit report.