Posted by Rick V on December 11, 2000 at 20:16:27:
State that you are buying the property for the amount of the mortgage, not to exceed $xxxxx.xx, and that you will be buying it subject to the mortgage, which will be credited against the purchase price.
When purchasing property for the loan balance… - Posted by Mrs SD
Posted by Mrs SD on December 11, 2000 at 11:49:05:
at the time of closing.
How is this written into the purchase and sales agreement? You actually use no dollar figure?
Thanks,
Mrs SD
In addition… - Posted by TRandle
Posted by TRandle on December 11, 2000 at 23:35:55:
Mrs SD,
In addition to what Rick suggested, it’s important to make sure whoever is doing the closing is clear on the fact that the existing financing will REMAIN in place. You are not paying it off and you are not assuming it. Good investing…
Please clarify - Posted by Bud Branstetter
Posted by Bud Branstetter on December 11, 2000 at 14:31:35:
Are you paying cash or getting a new loan where you would get title insurance or are you buying subject to where there would not be a formal closing?
Re: When purchasing for the loan balance… - Posted by Mark (SDCA)
Posted by Mark (SDCA) on December 11, 2000 at 12:05:31:
Put in an approximate amount and say that you are assuming the loan. The title company will figure it out at closing. They have to do this with conventional loans as well (since the owner doesn’t know exactly what is required to pay off his old loan).
Mark
Re: In addition… - Posted by Redline
Posted by Redline on December 12, 2000 at 14:52:24:
And if this is an attorney or title company, they themselves don’t care about any DOS problems?
Just wondering, thanks.
RL
As I’m still in the theoretical stage… - Posted by Mrs SD
Posted by Mrs SD on December 11, 2000 at 16:41:55:
I’m referring to a scenario where I would be buying a property subject-to and I wanted to purchase it for the value of the mortgage at the time that I’m cashed out.
Thanks,
Mrs SD
Re: In addition… - Posted by TRandle
Posted by TRandle on December 12, 2000 at 19:54:40:
RL,
I don’t have vast amounts of experience with it, but the title company I use copied and modified my CYA letter for their own use. It’s not illegal and there’s a line on the HUD-1 for purchasing subject to so I don’t see why attorneys or title companies would care as long as the sellers make an informed decision. I’ve only done a handful of subject to’s and they were all closed at a title company with title insurance. I like the appearance of objectivity and the insurance.
I’m past the theoretical stage… - Posted by Bud Branstetter
Posted by Bud Branstetter on December 12, 2000 at 09:59:41:
Because you would be buying subject to there is usually not a formal closing and no title insurance. Someone will have to type up a deed for them to sign. Since you will probably be taking over a non-assumable loan you will do so in a land trust.
In addition to the comments about putting down the price I also add just what the owner will get, if anything. Those that buy subject to may add disclosures as part of the contract. After having several sellers default I make sure that I have verbage relating to what I am doing.