Posted by Warren Priske on January 04, 2005 at 10:29:03:
I deal with this all the time. I’ve gotten my direction mostly from lenders on this. Fillout a HUD-1 closing statement and fax the sellers a copy. Tell them to give it to their lender. There’s a line in the HUD-1 for loans taken Sub-2. List their mortgage their. When they submit it to the lender, have them explain that you make the payments. I guarantee this will work. Lenders think a HUD-1 statement is handed down from God. You can find a copy of a fill-in-the-blanks HUD-1 at www.foreclosureforum.com. Have fun.
Taking the deed sub 2, and seller needs to show their new lender that their debt ratios shouldn’t be affected by the existing mortgage. What documentation need I supply to the seller/seller’s new lender to satisfy the new mortgagee? A vague recollection tells me Land Installment Contract, but I’m not sure that makes sense. Please advise.
Posted by Doug McDowell on January 04, 2005 at 10:12:56:
I wish I could help, but I’m curious to hear the answer to this as well.
It seems to me that if the original mortgage stays in their name until you pay it off then it will still affect their debt ratios. MAYBE (big big maybe) a copy of your purchase and sale agreement would help?
Interested in learning how this turns out.
Posted by Randy (SD) on January 04, 2005 at 11:13:25:
As Warren suggested fill out a HUD-1 (you can get a “fill in” at this site)
Line 503 is for loans taken “Subject To”…
NOTE: unless you have the full version of Adobe you cannot save this file once it is filled out, you can print copies of the completed form. So make sure you print several otherwise you’ll be doing it again.