But as Joel said, most lenders will use their own methods in determining if they will lend or not.

IMO, many HMLs don't understand this and take advantage of a situation to advance thier self interests irregadless of the outcome to a borrower.A good lender can assess the risks, the viability of a project, understands the market, is aware of costs and liabilities as well as the legal aspects surrounding the business and from that determine what rate of interest and fees is ethically justified on a case by case basis.

that am so desperate to find a gem, either for cash flow or wholesale.So pretty much the ratio between gross potential income and expenses don't justify the sale price.what metric is used to determine the percentage of return on sale vs. potential gross income?

You need a CPA type person to determine what is the acceptable % of your purchase attributable to the improvements (excluding the land) as Mary Joe indicated.

The other thing would to ask her to pull her own credit and determine if there is anything that needs to be corrected or worked on before sitting before a lender.

Over my long real estate career I have been involved in all three at one time or another, either as a principal or as an expert witness.The amount of money in dispute will determine as to whether or not it is economically viable to engage an appraiser, accountant or attorney on your behalf.

Before you do anything else Brian, I encourage you to determine your marketing budget.

OTH wouldn't section 8 want to know about change of ownership?

One is whether property ownership fits into your timeline and whether long-distance ownership works.

But there is always that risk.The simplest way to sell is to find better qualified buyer who can get a loan.If you're determined to sell to this buyer, you could also do it with a lease/option.