Any lenders or creative finance gurus know how the Debt to Income ratio is calculated with Seller financing (Subject To Wraps) or Lease Options?
I understand rental income is only counted if they have had 1-2 years experience with this income type.
How would it be affected with Seller Financing (Sub2) or Lease Options?
I'd like to use these creative financing strategies, but how will that affect a seller's opportunity to turn around and get a new conventional loan?
on a sub to they keep their loan in their name for a while so if that particular obligation is still at the edits on their balance sheet
I never tell the seller they can get a new loan after a sub2 sale
On a lease with option I chose the seller that they're turning the property into an investment property, the landlord tenant relationship, and generally the amount of rent that's coming in they will get credit of about 70 to 80% of that as income on a loan app and comparing that with their mortgage it might be an offset
On a wraparound mortgage it's more complicated because you need to see the taxation of the Wrap, see a CPA; as far as getting a new loan, you have the loan in your name, and then you have a payment coming in which offsets the debt to income
It's been my experience that different lenders have different qualifications as far as how much of the cash flow will be applied debt vs income
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