Seeking attorney to create Subject To Contracts
Hello All
I'm interested in having an attorney create a contract that I can use to purchase real estate subject to.
Does anyone know of a good one that could help me?
Thanks in advance for your time!
Quote from @Bryan Odom:If you buy a property Subject To the existing loan and in 6 months the bank calls the Due on sale Clause or the crazy ex wife contacts the lender, what will you do?
Hello All
I'm interested in having an attorney create a contract that I can use to purchase real estate subject to.
Does anyone know of a good one that could help me?
Thanks in advance for your time!
Quote from @Account Closed:
If you buy a property Subject To the existing loan and in 6 months the bank calls the Due on sale Clause or the crazy ex wife contacts the lender, what will you do?
@Account Closed What does fearmongering like this comment accomplish? Yes there are risks, but this is basically a thread hijack.
@Bryan Odom it what state you want the contract for?
For additional context, I'll tell you now that we use our own favorite contract nationwide, but I've had to make do with state contracts and other JV partners' own contracts all around the country for wraps, subtos, etc.
You don't need "the perfect contract" to get things going. A great contract is an asset for sure.
I'm not going to advocate you run fast-and-loose, because details matter... a lot. But a good contract does not a deal make.
If I can be of further assistance, hit me up directly.
Quote from @Caleb Christopher:
Quote from @Account Closed:
If you buy a property Subject To the existing loan and in 6 months the bank calls the Due on sale Clause or the crazy ex wife contacts the lender, what will you do?@Account Closed What does fearmongering like this comment accomplish? Yes there are risks, but this is basically a thread hijack.
@Bryan Odom it what state you want the contract for?
For additional context, I'll tell you now that we use our own favorite contract nationwide, but I've had to make do with state contracts and other JV partners' own contracts all around the country for wraps, subtos, etc.You don't need "the perfect contract" to get things going. A great contract is an asset for sure.
I'm not going to advocate you run fast-and-loose, because details matter... a lot. But a good contract does not a deal make.
If I can be of further assistance, hit me up directly.
@Caleb Christopher: Your comment: "What does fearmongering like this comment accomplish? Yes there are risks"
Why don't you concern yourself with the risk?
Do you buy "Due on Sale Insurance" that Pace Morby pushes?
Do you take personal responsibility if one of the transactions you help on in the SubTo community blows up ?
Did you know you can be sued for up to 7 years after you complete the deal?
Do you know that the Attorney General doesn't sue for Subject To.
He sues for the related crimes like bank fraud, wire fraud, equity skimming, fraudulent schemes and artifices and so on. Some pretty hefty stuff.
For your audience's review, the district attorney's office in Alameda CA said it takes a year and a half and costs the investor $100,000 to fight their lawsuits. If he is talking about it, it means it's on their radar.
Is that enough risk to get your attention?
I wouldn't dismiss it so lightly.
I guess they don't teach that in the SubTo Community, eh? Shameful. Investors beware.
@Account Closed, I cover those risk and more when I am working with clients and investors, this is about knowing the deal, what to do to prevent issues from coming up and know what to do if something pop's up.
Disclosures can be a great asset when doing any kind of Real Estate deal.
I am just glad you are not in the Health Care Industry if you are that concerned about the risk.
By the way I was the one who posted the letter from a crazy ex-wife, we handled it well, did not go into foreclosure.
@Account Closed any or all of that context would have been useful with your initial comment. That's the point of my prodding there.
I definitely DO concern myself with the risks, hence why I started a consulting company to help educate and guide people who would otherwise have practically no idea what they're doing.
No, there's no due-on-sale insurance, and Pace doesn't push it. There was a company he would mention from time to time, but they no longer exist. He opined to his students it was likely a poor use of funds.
Yes I'm aware of the larger issues, and the disclosures we use in my transactions literally have a highlighted portion regarding equity skimming. That can be pursued both civilly and criminally. It most certainly is a big deal.
Heck no I don't take responsibility if their deal blows up. Neither do the title company, closing attorneys, anybody else or their moms. Disclosures all around. It's a high risk transaction and the parties acknowledge the risk and their opportunity to seek legal counsel before proceeding.
Sued for 7 years...? That line lacks enough context to answer.
I'd love more context on the Alameda, CA situation. I do enjoy studying current events so I can better advise my clients and educate people in general on creative finance strategies and risks.
Overall, there's no light dismissal of risk by me or with my clients. Check my YouTube channel and you'll see plenty of warnings about pitfalls people should be aware of.
I've also recently assisted in handling 2 due-on-sale situations, and my clients are very happy with the results.
You have to be creative but SubTo is legal and can be done in CA. Can anyone recommend an attorney who has done this before?
Show your closing attorney or escrow officer this, they need to do their homework and know this is happening everywhere else, yes creative financing can be tough in Blue States below is a copy of a HUD1 which is a Federal Form - see line 503
Quote from @Roger Paschal:
Show your closing attorney or escrow officer this, they need to do their homework and know this is happening everywhere else, yes creative financing can be tough in Blue States below is a copy of a HUD1 which is a Federal Form - see line 503
Thanks, Roger! I appreciate that.
Quote from @Account Closed:
Quote from @Caleb Christopher:
Quote from @Account Closed:
If you buy a property Subject To the existing loan and in 6 months the bank calls the Due on sale Clause or the crazy ex wife contacts the lender, what will you do?@Account Closed What does fearmongering like this comment accomplish? Yes there are risks, but this is basically a thread hijack.
@Bryan Odom it what state you want the contract for?
For additional context, I'll tell you now that we use our own favorite contract nationwide, but I've had to make do with state contracts and other JV partners' own contracts all around the country for wraps, subtos, etc.You don't need "the perfect contract" to get things going. A great contract is an asset for sure.
I'm not going to advocate you run fast-and-loose, because details matter... a lot. But a good contract does not a deal make.
If I can be of further assistance, hit me up directly.
@Caleb Christopher: Your comment: "What does fearmongering like this comment accomplish? Yes there are risks"
Why don't you concern yourself with the risk?
Do you buy "Due on Sale Insurance" that Pace Morby pushes?
Do you take personal responsibility if one of the transactions you help on in the SubTo community blows up ?
Did you know you can be sued for up to 7 years after you complete the deal?Do you know that the Attorney General doesn't sue for Subject To.
He sues for the related crimes like bank fraud, wire fraud, equity skimming, fraudulent schemes and artifices and so on. Some pretty hefty stuff.
For your audience's review, the district attorney's office in Alameda CA said it takes a year and a half and costs the investor $100,000 to fight their lawsuits. If he is talking about it, it means it's on their radar.
Is that enough risk to get your attention?
I wouldn't dismiss it so lightly.I guess they don't teach that in the SubTo Community, eh? Shameful. Investors beware.
Mike, I absolutely hear you regarding your concerns. I'm still interested in exploring subject-to and other creative finance options. I know that there are people successfully making deals using creative finance. It seems like there's a way to do it consistently despite the challenges and risks.
Quote from @Bryan Odom:
Quote from @Account Closed:
Mike, I absolutely hear you regarding your concerns. I'm still interested in exploring subject-to and other creative finance options. I know that there are people successfully making deals using creative finance. It seems like there's a way to do it consistently despite the challenges and risks.
@Bryan Odom: I hear ya back. :-) I teach buying properties using "Subject To" or "SubTo" as some ca ll it. Feel free to PM me to answer your questions.
(that's all I've used for over 25 years, and it's made me rich.) It's a great way to build a portfolio, if it's done safely and legally
but, the investor can't be broke :-) This is not "no money needed territory" I"m not speaking about you, it's for everybody reading this.
It costs money to get a title report, pay for escrow, pay for the utilities, make the monthly payments, cover repairs and vacancies and have reserves and so on and the investor can't use a loan to over leverage the property. You have to stay away from certain selected Vulnerable Groups and Situations, Those are all lawsuits waiting to happen. And you have to have a solution if the Due on Sale
is called, which of course I provide for them.
What good is it to have one or even two "SubTo"s in your portfolio if it gets you sued or investigated? "Ya don't know what ya don't know" that's why you need honesty in learning Creative Finance.
I did a spreadsheet & I write about actual numbers on an actual deal with an actual HUD so you can get an idea of what a Solid, Great, Safe, Legal, SubTo looks like and how it works at:
Subject To – Why You Need Money To Buy Using "Subject To" (SubTo) - Safely, Legally
https://www.biggerpockets.com/forums/311/topics/1141313-subj...
The spreadsheet itself is available upon request to anybody that might be able to learn from it.
Hi Bryan,
Use a regular Purchase and Sale Agreement. Then, in the “special stipulations” or “further conditions” or similar section, write the clause in the photo. Good luck!
kim
PS I’m not a lawyer!