“Subject To Mortgage “ Deal & Deceased Sellers

[Vladimir Tejada]

Hello Everyone,

Last August I purchased a property in San Antonio subject to the existing loan (Wells Fargo HELOC). At the time, the owner of the property was deceased and his wife was no longer competent due to Alzheimer's disease. We were able to close the deal working with their daughter as POA but with the loan still in the deceased gentleman's name. Not long after I sold the property using a wrap. Fast forward to now, the wife has since passed away voiding all POA's. The mortgage is up to date but still in the original name. My question is how will I be able to continue controlling the loan without having this note called due by the bank..? Has anyone had a similar experience?

[Rick Pozos]

The bank will never know that the woman is deceased as long as you continue to keep the mortgage current and the insurance current. 

The bigger question is did you do an affidavit of heirship for the man before you wrapped the property?? Was the wife his heir or were they a newer married couple with their own children who could inherit?? When you do sub-to there is plenty of research to do to make sure that you are selling with clear title (except for the mortgage). If there are any encumbrances they will be yours to pay for. You guaranteed that you had clear title to the property when you gave a warranty deed.