Subject 2/DOS Question
Let's say you buy a property SUB 2 from a seller & get a buyer in who has made payments on time through a LSC for 2 years. Now it comes time for them to re-finance. The buyers then goes to a lender and applies for a mortgage.
Won't the fact that they are seeking a mortgage for a property that already has mortgage set off a DOS clause? WOn't the lender look at the property, run title and see that someone else is on it?
Also, I'm assuming that I have keep the deed in my name(or LLC) until my buyers refinance. That's a land contract or contract for deed, right?
Any help would be appreciated. THANKS
Well if you bought the house subject-to, then the deed is in your name. When you go to refinance, you willcut a check to pay off the first one, so the DOS clause shouldn't matter.
Seeking new financing will not give any indication to the old mtg holder that the property has changed hands.
Remember that the mtg and the deed are 2 entirely separate things. 1 has nothing to do with the other (unless you are getting near the end of a foreclosure LOL).
What you propose is CFD or Land contract, yes.
"Won't the fact that they are seeking a mortgage for a property that already has mortgage set off a DOS clause?"
The majority of homes sold in the U.S.A. still have mortgages/liens against them. People put their houses up for sale even though they still have a loan against it, and the new buyer gets their own financing to buy it.
At closing, the old loan is paid and if any is left over, the seller gets a check.
Roger
Thanks for the clarification everyone. I appreciate it