difference between subject to and lease option, and lease purchase

[Debbie Barrows]

Can someone explain the difference between the three? I thought all three could assume the existing financing.
Thanks

[Michael Quarles]

I think all of the heavy hitters are at a party this weekend so I will try my hand at the answer.

None of the options allow you to assume the financing.

The lease never gives you title until you actually buy the property and record the deed and the sub2 is not an assumption. A sub2 deal is taking title subject to the existing liens, both voluntary and involuntary, against the property.

In rare cases where the mortgage is private or a HML you could possibly assume the debt, as most HML and private lenders do not include the DOSC however at that point it wouldnt be a sub2 transaction.

Good luck