BUYING "SUBJECT-TO"

BUYING SUBJECT TO

• Taking over someones mortgage
• Why? Maybe they have no equity or are desparate to sell
• very minimum out of pocket for you as investor
• What about "due on sales clause?"
• As long as you make payments banks don't question

THE PROCESS

• Get signed agreement from seller
• Do a title check with title company
• close with attorney versed in subject-to; get deed!
• Negotiate the first payment 3 months after closing
• Notify insurance company and maybe bank

TIPS

• Have template letters for seller to sign
• letters from seller to bank & insurance co. (Property mngt)
• Establish relationship with seller to gain trust!!
• Possibly offer to open joint account at bank
• CYA Letter that seller understands mortgage is still in their name

SUBJECT-TO EXAMPLE

• OWED $18K
• 6 YRS LEFT ON MORTGAGE
• Placed a lease option "work for equity" tenant
• Always make payments and banks don't question
• Sent letters from seller to bank and insurance co