Creative Financing in texas

[Christopher Cole]

Can someone explain the difference in wraparound mortgage and subject to the mortgage to me and is one a better tool. Also is there a special guideline in Texas to do a wraparound mortgage thanks guys

[Chris Seveney]

@Christopher Cole

Subject to is when you buy it subject to existing mortgage - a wrap is the second half a subject to where you then turn around and sell it to someone else and put a second mortgage on the property where the new borrower is paying you as well

[Eliott Elias]

A wrap is if you owner finance a property that has a loan on it. Subto is when you take over the sellers loan payments  

[Christopher Cole]

Quote from @Eliott Elias:

A wrap is if you owner finance a property that has a loan on it. Subto is when you take over the sellers loan payments  

Thanks sir 

[Christopher Cole]

Thanks so much for the information one last question is there a Appraisal done when doing a wraparound mortgage and if so does the buyer pay for it

[Brad Sand]

Quote from @Christopher Cole:

Thanks so much for the information one last question is there a Appraisal done when doing a wraparound mortgage and if so does the buyer pay for it

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An Appraisal is not required in a wrap, since there is no traditional Lender involved. But, it may be desired. In a wrap, the Homeowner/Seller is the Lender and they may want an Appraisal for their own satisfaction, but it is not necessary.

And for the Buyer/Investor, no Appraisal is necessary. And, the investor should be experienced enough to know the value to them, regardless of an appraisal.