Seller Objections to sub2

Hi,
I am new here just had a question about sub2.
Say the seller is interested in doing a sub2, however they are planning on buying a new home with a traditional mortgage after they sell.
The seller’s objection:
“How do I qualify for another mortgage on my new home if I do this sub2 deal? According to a sub2 I still have a loan on this house, how will i possibly qualify for another loan?”

So I guess the question is, how do traditional lenders (banks) feel about sub2 deals? Will they consider a sub2 a sale?

Also feel free to add common objections/concerns you get when doing sub2 deals.
Thanks,
-Ryan

Ryan,
I most cases if you are working the sub2 deal you will send the seller’s lender a debt to income ratio letter showing that the sellers first mortgage is being paid down by a tenant buyer that you put in the property and in most cases your seller should qualify for a 100 % credit when he is qualfying for his new loan.
Without that income/debt letter most lender will only credit the seller 75% of the value for his next loan. Make sure you advise the lender that all maintanence, repairs is the responibility of the tenant in the property…
I have a copy of a the letter if you need one my email is colvegas07@hotmail.com
Good luck
Colin

Thanks Colin,
I sent you an email.

Also shortly after posting this I realized there are real estate articles on this site, unfortunately I didn’t know as I am new to this. So if anyone else is wondering about this topic you can find it under the sub2 area in the articles section. There is some very helpful stuff.