Subject To w/ Owner Financing and ARM

[Brickford L Faucette]

First time poster and would like some advice on the best way to structure the following deal. I’ve researched what I can but feel like there are some variables here that aren’t really covered. This would be my first creative finance deal as well, so I also want to make sure I’m structuring this correctly and using the correct terminology.


Looking to purchase a STR - Lake House where there is a current mortgage (26 years remaining) with an adjustable rate that kicks in August of 2025.

Sell Price: $850K

Down Payment: $170K (20%) 

Current Mortgage: $388K

Rate: 3.75% (until 8/2025) 

Seller Finance Portion: $292K @ 4%

Is there a way to structure this where the current mortgage is treated as it's own agreement so that the payment will adjust as the ARM fluctuates? Then the Seller Financed portion would be treated as it's own agreement with a locked in rate.

If not, what is the best way to present this to the seller so it addresses his concerns on how the adjustable rate is handled?