I Found A Good Subject To Deal, Now What?
I am a brand new invester, and this is my first deal of any kind. I found a house with a fair market value of around 95,000, but the owner wants out for the price she has left on the mortgage, 72,000. No back payments are owed, nor is she late on payments. The house is in excellent shape, she just needs out.
Could someone with a little more experience fill me in on the next step of the subject to process? I do not have a trust or corporation, I'm operating as an individual.
My exit strategy is to live in this house for the next few months (I want to stop renting) until I am restationed, at which point I plan on selling. Is this possible? How exactly do I get control of the title and how should I deal with her lender? Should I even talk to the lender and tell them what is going on? I am still a little worried about the due on sale clause.
I apologize for asking such newbie questions, but I want to get some other opinions and little guidance before I get into this deal, as it is my first.
Hi agentx73
To start out with “Subject to” investing you should check out these 2 articles:
http://www.thecreativeinvestor.com/modules.php?name=News&file=article&sid=146
http://www.thecreativeinvestor.com/modules.php?name=News&file=article&sid=266
and then the Sub to forum:
http://www.thecreativeinvestor.com/ViewForum34-1939.html
Hope this helps
John (LV)
I wish this deal was in San Antonio, I have yet to do my first deal, but I am learning QUICKLY, just have to finally get out there and put out some signs and newpaper ads.
How did you acquire this info on the house she owns, and do you have John's course? You need to get your paperwork together, so you can have her contract with you for the house. If you get this done, you can do whatever you want with the property since you'll be making the payments for her.
Hell, in the meantime, give her 500 to get out and tell her you'll move in while your getting your **** together so you can Sub2 this deal!
He can do this, right John?
Scott (san antonio)
Thank you for the good references, I have read them. However, like I said, I am very new to this. I understand the concepts, just not the specifics.
My main concern has to do with the lender. How should I deal with them? I don't have a trust or anything, so I would personally be taking over the loan. Do lenders typically allow this, and how is it done? Under what circumstances is this acceptable? Any advice from someone who has done this or knows how it is done would be greatly appreciated.
sahurst,
Actually, this deal is in San Angelo, TX, not far away. I just happened to be the only person to respond to a very badly written newspaper ad. If someone else comes in and offers some cash, then I won't be able to do much.
Unfortunately, I do not have Johns course. It is something I have been considering for a while. I have read many books, though, but none of them really address specifics of subject to deals. Can anyone recomend a book along those lines? How in depth does the course cover those deals? Again, any advice is appreciated. I'm trying to learn all I can.
Hi Agent:
Very simple. Have her grant deed you
the property and have her sign an
affadavit of uninsured deed. You can get this from a title company. You better hurry up though before someone with a better offer comes along. I would not worry about putting it into a trust for now.
I would not worry about the lender also,
they rarely excercise their due on sale clause. You might want to contact a
local escrow office and tell them you want to start doing business with them and see how much to prepare the deed.
Good Luck
thanks jeffca,
I can see already I need to get the how to manual.