Subject To Exit Strategy?!?
I know one exit strategy of the Sub To investing is to lease option it to a tenant buyer who will eventually cash out the original owner, but what are the other ways to get your money out of the deal? Are there ways of selling where you will get cashed out and the owner will get removed from the mortgage??
How do you go about doing this?
Any suggestions, etc would be great!
Thanks!
[addsig]
Matt:
The great thing about sub2 is you have any number of exit strategies: once you have the deed, you OWN that house. You can do anything you want with it to get rid of the original seller's loan. You mentioned L/O, but any way you can think of selling will work, if you do it right. Here are some ideas (not in any order or recommendation):
1. Land contract: 1-2 years buyers paying mortgage, plus some extra, with a balloon at the end for the deed. Cash = downpayment, monthly extra, balloon at the end.
2. Sell it conventionally, by FSBO or with a realtor. Have funds at closing payoff original mortgage, rest goes to you. Assumes you paid less than retail for the sub2.
3. Rent it out: if you can make it cashflow, monthly money in your pocket (but note stays in original seller's name longer).
4. Refi: get your own mortgage on the house, pay off original seller's loan and do whatever you want to make payments on YOUR mortgage.
Andy[ Edited by arytkatz on Date 05/17/2004 ]