Purchasing Sub-to Seller Finance Contract?

[Paul Crutcher]

Hi everyone!

I'm currently looking at a home that was previously on the MLS and failed to close via conventional financing 4x due to deferred maintenance and stubborn sellers possibly.

So going to a bank for financing isn't an option for this home. 

The home currently has a ~$160k seller finance mortgage that the current seller is paying (not sure if they're performing). They did want $60k over the mortgage amount, however I believe it's only worth $20k over. 

So I was thinking of offering to take over paying the note and basically giving the seller a cash sum for the rights to the contract/deed. I haven't heard from the seller yet if I can get a copy of the original contract.

How would I go about this? What attorneys would y'all recommend to help me through this process? 

[Thomas Santella]

Quote from @Brenda Scally:

I am in a similar situation. Considering a subject to contract (I will assume mortgage responsibilities, and he will give me a quit claim deed having been given some walkaway money). That still puts the seller in the hot seat for a bit as he is liable for the mortgage note until it is paid off ultimately. Depending on the length of time, this can affect his credit rate and his borrowing power, so there is risk on his part that I need to find an equitable solution to.

If you provide a DTI declaration form to the mortgage company informing them that their debt is being serviced by you, 75% of it will be cleared in year 1 and 100% by year 2, allowing them to borrow again. Furthermore, if you are servicing their debt and not missing payments it will help their credit.