Questions about Subject To

[Amina Sanders]

Hi BP!

I 'm a REI newbie and have question concerning a possible "subject to" deal. My sister and her husband have gotten into some financial trouble. Almost ten years ago, my brother in law's family home was going into foreclosure. Sadly he decided to help them by taking out a loan and purchasing the property. Now, his family no longer wants to live in the house and has decided to stop paying the mortgage. Of course he and my sister are now responsible for the loan payments. They are financially unable to take over the mortgage and pay for their primary residence.

My husband and I were considering possibly acquiring this property through "subject to" and then rent out the property. 

To give you some numbers:

$105,000 is owed on the property

$1,211 is the mortgage payment

Average rental income in the area is $1,900

Meanwhile, the home is in poor condition and would need some repairs/renovation. The roof, the foundation, the plumbing and electrical would need work to say the least. My sister is working on getting a general contractor to give an estimate some time this week.

My question is: If we acquire this property with no money down by means of "subject to" title exchange, how would we finance the rehab? Would my brother in-law be able to refinance the house for it? Would it be smart to take out a loan in our name in order to finance the rehab?

Any advice would be much appreciated as we're both very new to this.

P.S.

If there are any wholesalers in the Atlantic county NJ area, please feel free to contact us!

Thanks,

Amina S.