Sub2 Hybrid Deal Question

[Collin Parody]

I am looking to purchase a duplex subject 2, keeping the low interest rate, while seller financing the rest of the equity. I am a mortgage professional by trade and the one worry I have is changing over the taxes and insurance that are currently escrowed from the mortgage owner to the LLC that I have created to transfer the deed to.

Has anyone ever done this, if so, how did you go about transferring the taxes and insurance from the mortgage holder to you?

Thank you!

[Jay Thomas]

Certainly! Transferring taxes and insurance from a mortgage owner to your LLC in a subject-to transaction is definitely doable with some careful planning. First, communicate your plan to the mortgage holder, securing written consent and checking the mortgage agreement for any restrictions. Update insurance policies and coordinate the transfer of tax bills with the assessor's office, providing the necessary documentation. Manage the process by opening an LLC escrow account, transferring existing funds, and setting up recurring payments. Keep detailed records of all transactions, update the mortgage holder on the changes, and seek professional advice to understand any tax implications. This thorough approach ensures a smooth and well-documented transition of tax and insurance responsibilities to your LLC.