Subject to transaction but Title Company has issue
I have a property under contract to take it subject to. When I met with the title company, whom I know does a lot of wholesale transactions, we discussed subject to's, wraps and contract for deeds. The escrow agent said they prefer subject to's. The escrow agent said in "speaking with our attorney since the current mortgage on the property has a due upon sell clause and right to call note if not owner occupied; we cannot close this or be a party to it if the current lender is not aware and agrees to the transaction." I explained that I was aware of the due on sale and had the funds should the lender elect to exercise that option, but planned to be upfront and was relying on them to prepare the paper work, whether it be a limited POA, disclosure letter, etc to the lender.
Her reply was, "The problem is not closing it; the problem is insuring it without risk to our company. We would like to know if these are being insured elsewhere and the verbiage they are using to do so when it does come to the due on sale clause." It seems to me that when she told me they do subject to's, she was talking about assuming the mortgage.
Has anyone dealt with this issue? To me the title is clean but the mortgage remains an encumbrance on title, so I'm not sure what the problem is with insuring title. I appreciate any insight to this situation.
Thanks,
Drew