Does anyone really have luck with Subto?

[Bj Meadows]

I have read and read about subto deals... does anyone have luck with this? HOW do you find these deals? How do you find these distressed home owners without paying a ton of money for some of these lists? Is there anything out there that really works? Any advice appreciated!

[Shanequa J.]

You can drive around town looking for properties that looks distressed, put up signs, let your friends/family know you buy houses, look online, etc. 

A ton of money is subjective. You're either gonna spend time or money.

[Bj Meadows]

I have been watching a lot of Jamel Gibbs-just trying to build that courage to move forward. THANK YOU!

[Sarah Reece]

Quote from @Bj Meadows:

I have read and read about subto deals... does anyone have luck with this? HOW do you find these deals? How do you find these distressed home owners without paying a ton of money for some of these lists? Is there anything out there that really works? Any advice appreciated!

This is exactly the question that I have as well. I have a background in lending, have been a Realtor for 25 years, understand creative financing really well...however in all of my asking about this I have not yet found anyone that has successfully closed a subto in a fully legit way. There's a lot of people that say you can just take over the payment of the seller and have them sign a silent DOT, but without approval/knowledge of the underlying bank. I'm sure that is true, because most mortgage companies aren't going to go searching for issues when there aren't problems - but in the truest sense of the word this is loan fraud and I'm just not up for it in my portfolio.

I did hear from a friend of a friend type that she was able to close a subto with a small local bank somewhere in Georgia (property was also located there) because of a long standing relationship with the bank.  Who knows if that is true or urban ledgend.

[Sarah Reece]

Quote from @Account Closed:

Quote from @Sarah Reece:

Quote from @Bj Meadows:

I have read and read about subto deals... does anyone have luck with this? HOW do you find these deals? How do you find these distressed home owners without paying a ton of money for some of these lists? Is there anything out there that really works? Any advice appreciated!

This is exactly the question that I have as well. I have a background in lending, have been a Realtor for 25 years, understand creative financing really well...however in all of my asking about this I have not yet found anyone that has successfully closed a subto in a fully legit way. There's a lot of people that say you can just take over the payment of the seller and have them sign a silent DOT, but without approval/knowledge of the underlying bank. I'm sure that is true, because most mortgage companies aren't going to go searching for issues when there aren't problems - but in the truest sense of the word this is loan fraud and I'm just not up for it in my portfolio.

I did hear from a friend of a friend type that she was able to close a subto with a small local bank somewhere in Georgia (property was also located there) because of a long standing relationship with the bank.  Who knows if that is true or urban ledgend.

HUD (Housing and Urban Development) the people who bring you the lending industry, seem to think it's okay.

It's line 503 on your closing statement
Click to enlarge

You can click on my website link below and see a whole slew of Subject Tos we've done 

I'd be happy to answer any questions 

 With respect, there is a difference between having an available line on the settlement statement versus approval of any action.   

As I stated, I'm sure people are doing it and this happens every day.  The mortgage company is still getting payments, so they aren't going to go looking for anything unusualI until their is cause or unless they stumble on it. I am also willing to bet you dinner somewhere that the loan docs on the underlying mortgage have somekind of prohibition on doing exactly what is being done.  People have all kinds of different levels of risk they are willing to take...and from what I can tell most often worst case scenario is that they call the note due.  That said, that isn't the kind of action I'm personally cool taking part in or giving advice to others to do.  I live in Seattle and not jazzed about getting a $500k+ mortgage called, you know what I mean?

If I can be proven wrong I would LOVE that, becuase it means that there are a crap ton of creative ways of helping people with 2-3% mortgages achieve all sorts of things while keeping their loan that they don't think they can...