Transaction without mortgage, subject to HELOC?

[Thomas Burnett]

Very specific situation I've got here that I haven't been able to find good information online that fits this unique criteria.

I have a friend that has a property that they own free and clear of mortgage, yet they are paying a HELOC of approx. $300 a month for. They are torn between trying to fix the place up and sell at retail or just unloading the burden(tired landlords). Estimated repair to get it rent ready are between 5-10K.

Because they know that I am trying to get into the real estate game, they want to help me out, but still want it to make sense for them as an exit strategy or partnership.

I don't know what type of transaction would result in a win win. Subject to? Lease option? Wholesale is out, and so is a owner financing because of my lack of capital and cash flow in relation to what they expect for an actual sale as they want top dollar.

I have reached out to a title company and a real estate attorney as well, however, because it is a weekend, responses will be delayed. Any creative contractual suggestions, or transactional guidance is greatly appreciated.

[Wayne Brooks]

A HELOC Is a mtg, by the way. Sounds like you don't know the balance of the heloc. Sub2 on a heloc is probably trickier since they can be called even easier than a traditional mtg, aside from the due on sale clause. Are they willing to let it go for the balance of the heloc? Of course a sub2is risky for them since they can be foreclosed on for a property no longer in their name.