How does Subject too benefit the seller?

[Jon LaBorde]

I’ve been researching subject tos and I just just wondering, does subject to benefit the seller in anyway other than getting the mortgage liability away from them? The way I heard it explained is that you take over the existing mortgage and then you can either rent it or transfer the mortgage to someone for free but the videos I’ve watched never say anything about giving the seller anything other than money down to lock it up. I’m just curious, if anyone can give me a better explanation I’d really appreciate it, thanks!

[Doug Pretorius]

@Jon LaBorde Debt relief is the #1 benefit for the seller in a sub2 deal. Depending on the situation and how much equity they have you may need to pay them moving money or even cash out some of their equity. But typically the seller can't afford or just doesn't want the house anymore and they're ready to walk way but they don't want their credit ruined by a foreclosure. So the investor steps in and takes over responsibility for the house.

If the seller has a lot of equity that they don't want to walk from you can also combine a sub2 with seller financing. Give the seller a 2nd mortgage for their equity and pay them out over time or when you refi.