Colorado Springs, CO · Member since 2016 · 59 posts · 33 votes
9y
To my knowledge, purchasing a home 'Subject to' does not allow for a refinance since the home is still owned and in the name of the current owner. You are merely purchasing the home, subject to the existing loan balance, plus any additional agreements made. This technique is primarily used for investors to control a property via contract, while not having to obtain a loan in their name.
To complete your purchase as you've described, it would make more sense in applying for a home loan in your name to obtain a lower monthly payment. If not, you'll be completing the 'subject to' agreement, and likely need to do a 'Lease option' for a potential buyer to rent the property until they can complete the home loan process to exercise a purchase agreement.
Please note, I am not an attorney and this advice is the product of my Novice education of REI techniques, so please correct me if I'm wrong.
Rental Property Investor · Houston, TX · Member since 2015 · 64 posts · 29 votes
9y
Sounds like a workable deal as you explained it. I would not worry about refinancing it - just keep the cash rolling in and find another deal. When you need cash then you can refi with cash out. Best to season your ownership and make sure your tenant is stable before a refi.