Buying a house subject to existing financing

[Suzette Parsons]

I am attempting to help my mother out of a sticky financial situation.  I want to make sure I do this the best way possible and I know that there are lots of more experienced investors that will hopefully give me some advice.

I am trying to buy my aging mother's condo in AZ so that she can have a place to live. She can no longer afford the payments. I have read a lot about subject to financing, an think that it would be a good option in this situation. Her first mortgage is a VA loan with a balance of 67K. The second mortgage is with a local bank for 31K. Market value of the condo is about 105-110K in its current condition. I have been able to negotiate with the bank to get the second settled for 11K, if I pay in full in 30 days. There are no other liens that I am aware of.

What is my next step? Go to a title company? Do a quick claim deed? I estimate that my mom will be able to live there for about 5 more years. Her VA mortgage has a good rate, and I am thinking to just assume the payments, rather than pay closing costs for a new loan. How can I avoid the due on sale clause? Should I pay the 2nd off after I put it in my name? I've done lots of flips, but never any subject-to financing.