Posted by John Merchant on June 28, 2009 at 11:45:58:
Any of your local area independent* escrow cos, found online quickly, could answer your question.
Sub-to sales have nowhere (to my knowledge, but I could be wrong)been outlawed by any state statutes, as such a sale doesn’t really change any party’s rights or legal liabilities.
Real issue usually is full disclosure to seller, explaining that the original borrower is still on his note, has not been released, and if new buyer doesn’t pay it’ll still be the original borrower’s to deal with.
There have been some RE con-artists around the country who bought a lot of props w/o any such careful or honest disclosures, sometimes causing great harm to the seller so it’s entirely possible now that some states’ legislatures have now seen fit to tighten up their law.
*the big, national Title/Escrows might do a sub-to deal but insist they must notify the lender, etc. whereas the independent, stand alone escrow, unless mandated by local law, usually does NOT require such lender notification.