Did I read that right? What happened? - Posted by FJW
Posted by FJW on November 06, 1998 at 17:49:29:
Let’s hear this. You can’t just leave it at that. You have to tell us the deal, the bank, the whole nine yards. Otherwise, everyone will just think you’re a left wing, bleeding heart, worried that the KGB isn’t getting their share.
Come On…out with it. Please.
FJW
Re: Let me understand this . . . - Posted by JPiper
Posted by JPiper on November 07, 1998 at 02:09:33:
Tom:
I’ve taken over many loans subject to. To be honest, most of the time I do it with a trust…my preference is to take a low profile. I do this because while I haven’t seen a loan that was current accelerated, I can imagine circumstances where we would.
About 10 years ago I was caught in a violation of the due on sales clause. The short story is that the bank asked us to assume the loan. We declined. The bank then threatened to accelerate the loan. We did nothing. We never heard again from the bank.
Since that time, I have had discussions with bankers. I can assure you that no one is monitoring who pays the monthly payment. No one is paying attention to a loan until such time that there is a reason to…like the payments are in default, or the insurance is changed…something like that.
These days banks aren’t trying to accelerate loans that are being paid. Why should they?? So that they can reinvest their money in a new loan at lower rates??
But keep in mind that things do change. There may come a time during a period of rising interest rates where the banks have an incentive to accelerate low interest rate loans so that they can lend out at higher rates. Better to do these types of assumptions in trusts in my opinion. It’s a small and easy step. And one that makes it more difficult for the bank to detect.
JPiper
Re: Let me understand this . . . - Posted by R. Porter(ohio)
Posted by R. Porter(ohio) on November 06, 1998 at 21:22:11:
I have to agree with you on this. I have been involved in at least 6 transactions where we bought houses “subject to” the existing mortgage and just took over the payments. I have not heard from any of the lenders about due on sale clauses, etc. I send in the payment with the coupon, they deposit my check, and nothing happens.
Several years ago, on the first one I did, I actually called the bank after I bought the house. I had insurance issued by my agent and had the bank named on the policy and the title company sent the new policy to the bank. The seller then cancelled her policy. The bank called her wondering why the policy was cancelled and that they were going to place “forced” coverage on the house. I called the lender, told them that I now owned the house, and that I would send them another copy of my policy and paid receipt showing the the house was insured. That satisfied the person in that department, and she suggested that I talk to another department so that the bank would know who the new owner was. I talked to that person, gave her my name, address, and telephone number and explained that I was the new owner of the property. She then informed me that I couldn’t do what I had done, and that someone from their legal department would be in contact with me. I never heard from anyone at the bank. I fixed up the house and sold it about six months after I bought it. After this experience, I came to the conclusion that the due on sale clause is not something to worry about.
Re: Did I read that right? What happened? - Posted by Tim in Atlanta
Posted by Tim in Atlanta on December 01, 1998 at 07:20:58:
If you would like I can send you the exact detailed information, but it goes like this. I legally assumed an assumable mortgage. During the time that the county takes to file the new Warranty Deed, the mortgage company would NOT cash the checks I sent them. Once they had the new Warranty Deed filed by the county, the checks were cashed and now everything is fine. The mortgage company is Colonial Mortgage Company. I have also “assumed” 4 other loans with the Warranty Deed subject to these loans in a wrap situation. The checks I sent in for these loans were accepted fine. I called and changed the mailing address on these loans, left the name on the loan the same (because it was not me), and the bank is perfectly happy.