Re: "Subject To" Questions - Posted by Bill

Posted by Max-Va on April 11, 2007 at 22:39:09:

What you describe is an assignment not a sub-2 deal

Re: “Subject To” Questions - Posted by Bill

Posted by Bill on April 11, 2007 at 16:29:16:

In buying a property “Subject To” the existing mortgage so the “Due on Sale” clause is not triggered, would the buyer, using a standard real estate purchase contract, simply insert their name (Joe Blow &/or assigns)and then when re-selling to their prospect, simply assign that original contract to their buyer? (Hopefully I’ve explained asked this question clearly) To protect oneself, what needs to be recorded if anything? Any and all information is greatly apreciated.

Depends on what’s recorded - Posted by John Merchant

Posted by John Merchant on April 14, 2007 at 10:40:54:

If I’m buying, I want the Deed, not merely a REC that says “someday” I’ll get the deed…or at the very minimum, a REC that I CAN record, meaning it’s signed and got a Notary’s Acknowledgement for so the Recorder will record when I present it for recording.

The REC might or might not trigger the DOS, depending on the language of the bank’s mtg or DT and note…so if I’m doing the buying, you bet I’ll want to read both those docs beforehand so I can know if it triggers the DOS clause.

But, when I’m wanting to sell on a REC, I make very sure there is NO NP’s Ack form so that doc cannot be recorded so there’s nothing to concern the bank, as to them and the world, nothing’s happened and I’m still on title…and of course, still on their note making their payments on my note.

With the plethora of new anti-REI laws afloat in several states (e.g. TX) this strategy might not be legal anymore, so I’d want to know and read the law in the state where I’m working.

Appears this selling and/or buing on RECs and Deeds and the whole topic of Sub To & DOS is a little fuzzy to you so I’d recommend you find some old-timer and sit down with him/her over a few cuppas de Starbucks, and get some basic know-how.

Re: “Subject To” Questions - Posted by Rich

Posted by Rich on April 13, 2007 at 23:13:49:

You need to read the mortgage agreement’s section that people call “due on sale”. If any item listed happens, the lender can, without notice, call the loan due. Its better called “due on change of name on title” since with few exceptions that is what its actually about.