The "due on sale" clause (DoSC) obligates the seller to notify the lender if the property is sold.Failing to do so would place the seller in violation of this agreement, giving the lender the right to accelerate the loan.But no laws are being broken here.So, subto is neither legal nor illegal.Second, it only works because most lenders are more interested in receiving payments than in invoking the DoSC clause and foreclosing on the property.But, it can work, provided seller and buyer are both on board and the proper process is followed.Thanks for the clarification.

I would run this by your realtor/property manager to get clarification.

@James Boreno - please ignore the above very technical clarification.

Can you provide more clarification?

But STR has restrictions here (2 bedrooms in Raleigh) (hence the hybrid option) and there is often diminishing returns when it comes to price versus number of rooms in our market in the locations I focus on. 3 bedroom numbers often are stronger and more attainable price wise than 5 in core Raleigh.

Got it, thanks for the clarification. 

Build-to-Rent (BTR): A Steady Income StreamWith homeownership becoming less attainable for many, build-to-rent properties are in high demand.

@Michael Plaks This is an excellent clarification!

@Rene HosmanThank you for reaching out and give some clarification for the PP structure.

You do not need to take on new debt for the $450,000 reinvestment unless you choose to do so for other financial reasons.If you have further questions or need clarification, feel free to ask!