Re: “Subject to” Name still on mortgage. - Posted by Bud Branstetter
Posted by Bud Branstetter on February 18, 2002 at 09:28:45:
Cars and consumer credit will depend on their scores. They adjust the interest rate to make their money. Ratios matter very little.
If the motivated seller goes to a new lender it all depends on that lender. While there would be a problem with a a second FHA loan there is much less restriction on a conventional. VA loans revolve around their eligibility for guarantee of a certain amount. If you direct them to your mortgage broker the ratios will not be affected. He is more likely to treat it as a CFD situation in which the 75% credit of rents is not used. There are approaches such as Gatten’s EHT that there is an almost 100% record of the seller not having the old property taken into account when figuring ratios.
The seller will be at risk from inexperienced and lowlife investors that let the loan go into default. Third party collection, third party trustee and provisions to regain the property if they have to lowers or eliminates the risks to the seller.