Wrap-Around Mortgage vs Subject 2 - I need advice please!!!!

[Wes Martinez]

Hello fellow BPs,

I'm currently in the process of doing an off-market deal with someone who prefers a type of seller financing in order to save money on closing costs, but they currently have a mortgage on the property.

Here's the deal:

- Asking: 240k

- Current mortgage balance: ~100k

- Rehab needs: 40k

- Value after reno: ~350k (I own the house next door and it was appraised at that after renos)

The plan is to back into an easy refinance in 12 months, all while doing our best to avoid "Due On Sale" clause. I think I've read just about every post on here on DOS, so I'm very well aware that it is a real risk and basically impossible to fully eliminate, but not likely to be called on if payments are made on time and hazard insurance is changed carefully.

I also realize there are more risks than DOS... I.E. seller declares bankruptcy, etc.

I guess my question is... what is the difference between sub2 and wrap-around and which would back me into a refinance the easiest? I've also researched land contracts/contract for deed, but that seems way more riskier for me (the buyer) right? And also haven't found information on these threads on whether a traditional lender would recognize a contract for deed as true ownership and allow me to refinance.

This investor has 8 other properties and I get the feeling their spouse passed or something unfortunate happened (the investor is in their 60s and all their properties have what I assume is their spouse's name on them too) and now they're just slowly off-loading them instead of dumping rehab money into them. I'd love to nail this deal to gain their trust and hopefully have me be their first choice before putting their other properties on the market!! Thank you so much in advance for your advice!