selectable front locker (I think the e-locker is or will soon be available for the H2 front) with a 2.5" lift minimum (4" max) and appropriate tire/wheel combo (37s look very good on the H2 IMO) and you would have a VERY capable vehicle. Like Det said: you start working towards a very purpose built vehicle. Putting a front selectable locker and mild lift will have little to no affect on your handling, except for off road! your ride will probably be more affected by your choice of shocks than the mild lift. larger lifts than 2.5" will start to affect the suspension angles which will in turn affect the handling and need to be compensated for in the kit with beefier/longer components.
Currently Skyjacker, Rancho, and FabTech make suspension lifts for the H2...all are established companies. I don't know anybody making a body lift kit for the H2 yet...but a smaller suspension lift and body lift would be a great combination of larger tire/modest lift IMO. 2.5" suspension with a 1" body...that would allow a 37" with no rubbing in the fenders - add a set of wheel spacers or wheels with correct backspacing and you put yourself in a great position without doing creating major stress on the drivetrain. but the steering components would take a beating when aired down offroad due to the extra grip the tires would have. so as usual - you gotta give a little to get a little
the H2 platform is similar to the GMC2500HD so a body lift for that truck or suburban ($270 for 2") would probably fit and give you tire clearance without the major suspension upgrades.
JMO...but it also depends on the terrain your building for. There is a reason you don't see those monster trucks rock crawling, they are too tipsy - but they can run mud pits all day.
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