How does "subject to" deals work exactly and how do you get paid?

[Brittany Burton]

There has been a lot of discussion about "subject to" investing and im just curious how the get paid off this deal and how it works seems like a creative solution to get some deals done

[Brian Gibbons]

That's a good question and a lot of people don't understand subject to, or taking title subject to existing financing.

I train in subject to and I like to use sub2 if I love the house and it's in perfect shape, and the PI TI payment to the seller for the mortgage company is less than market rent giving me a reasonable cash flow

Marketing I go after expired listings and I give the seller either a subject to offer, a wraparound mortgage offer, or a lease option assignment offer

Realize if you buy or acquire the property on subject to or wraparound mortgage, you have a title, and you can sell it. This works better with you owning title versus assigning a contract, in many states.

The downside or warning about subject to is that you need a plan in case the loan gets called due to the due on sale clause, if the mortgage co decides to call the loan due.

What I do is I give the seller a quick claim deed in escrow in case the loan gets called due and I need to give the property back.

I also stipulate that if I'm more than 60 days late with paying their existing financing, then they get the property deed back

Rookies in real estate need good training in sub 2 and a great contract attorney.

Lastly I like title holding trust with sub 2.

@Karen Rittenhouse

@Account Closed