Bankruptcy And Subject To
I have a possible deal. The house has a First and second loan on it. The second loan is about 10,000. The owner is thinking about Bankruptcy. If I buy the House Subject To The first loan. Can the owner do a Bankruptcy on the second? Can the second come back and foreclose on the house? The second loan will not negotiate at all. they want the full amount of the loan. Thanks
When you take a property "Subject to" You take it Subject to all leins and incumberences, not just the ones you want to leave in place.
Yes the second could foreclose on the property.
Be very careful to conduct your transaction the right way. You don't want to get in trouble for working with the owner to defraud the lenders. It's better if you don't know that they are going to file the bankruptcy petition.
Good luck,
Jeff