Anyone have exp with Subject to Financing?

[Cory Basham]

Looking for some advice/guidance...Does anyone have experience with "subject to financing"? I am not that familiar with this type of transaction, but may have a situation that fits the bill. Would love to hear some feedback on this.

Looking to buy a house from a really good friend. His mother is going into an assisted living facility and needs to sell...all they are looking for is to pay off the mortgage owed (about $108K) I would prefer not to come out of pocket to satisfy in full b/c i have other projects going on and i'm a bit cash strapped until they close. Since we are good friends, i was thinking maybe a subject to financing option could work. I can afford to pay the monthly mortgage on the place and do the necessary rehab work, just don't have the capital to shell out $108K + rehab costs.

They would probably be okay with this, just would like to know if there are any challenges/hurdles i will face? What steps are involved in moving this forward? Do i just transfer deed and then deal with the lender? Do i need to speak to a title company to get legal clarification? Any chance the lender will ask for payment in full when the deed changes hands? What about HOI, what changes with that?