Buying Sub2

[Wes Brumit]

When purchasing a vacant home with Subject To, how does getting the utilities turned back on work? Is it just a simple call to utility companies notifying them that you are the title holders now? Also, are there any concerns to know should the original loan holder pass away?

[Matt Devincenzo]

IMO utilities will be one of the easiest things to get done in a sub2 deal. In my area the electric utility will put them in your name just by you asking no proof required. I assume the thinking is if you are wanting to pay for utilities then you must have a reason. The water utility wants to see either a HUD-1 or a signed lease if you're a tenant, so again not a difficult proposition.

As for the death of the borrower. That's something that could happen, and you should have everything planned for in a worst case scenario like that. Your authorization to release and POA will help with that. I haven't done a sub2 so I can't say what all you would need for sure. @Bill Gulley has mentioned several times about the importance of planning for that, and what you as the buyer need to do when you purchase to be ready for a situation like that.

And as always seek REI savy legal counsel that can help structure everything properly from the start so you aren't trying to correct things later that could/should have been handled earlier.