Sell Your Property Subject To The Existing Mortgage Remaining In Place

*What Does It Mean To Sell Your House “Subject to the Existing Mortgage?”

• Buyer purchases home by taking over remaining mortgage payments and all other obligations (any liens, etc.)
• Buyer gets deed to property (which represents ownership) | Mortgage remains in seller’s name after closing
• Sale price is calculated as offered cash payment + remaining mortgage balance (and any liens)

*When Should A Seller Consider This Type of Transaction Instead of a Traditional Sale?

• Low equity (seller avoids bringing money to closing to pay off mortgage, closing costs, liens, etc.)
• Facing foreclosure or behind on payments (seller gets mortgage payment relief and credit score help)
• Distressed property (seller avoids making repairs that would be required with traditional financing)

*Can The Seller Obtain Another Mortgage With This Loan Still In Their Name?

• After 12 months this mortgage payment can be offset from the seller’s debt to income ratio (subject to underwriting approval)
• For VA loans, the seller will be able to use their remaining entitlement minus this mortgage balance

*How Long Will the Mortgage Remain in the Seller’s Name?

• Our obligation is to pay the monthly mortgage payments until it fully amortizes and reaches full term.

*How Do You Protect the Seller’s Interests? What Are The Associated Risks?

• We make payments on all mortgages by the 10th of the month (we provide email confirmation to sellers)
• We maintain adequate liquid capital via lines of credit and saving accounts to meet all financial obligations
• Loans contain a “due on sale” clause giving the lender the ability to call the loan due if the deed is transferred
  ---While lenders can exercise this option, they primarily prefer to collect payments with accrued interest
  ---We may exercise the option to purchase the property in a trust to mitigate this risk (Garn St Germain Act)
  ---We make timely mortgage payments and establish the insurance appropriately to mitigate this risk

LET’S WORK TOGETHER!

• I am a resource to help sellers avoid the expenses, the hassles, and the inconveniences of a traditional sale.
• I cover all closings costs so that sellers have no out of pocket expenses
• I buy homes in “as-is” condition with no repairs required
• I can close in as fast 2-3 weeks (or allow the seller to set a closing date at their convenience)
• I pay Realtor commissions!
• I look forward to building a relationship with you!