Anyone with success assuming a mortagage loan?

Question

Was wondering if any one has had success ever taking over/assuming another persons mortgage. I talked to a guy and he really just wants out of the mortgage and was even thinking about for closing on it.

thanks

Dave Van Horn · Answer

Hi @Shane Jeanfreau,

Underwriting is strict as it is, so officially assuming someone's mortgage requires bank approval which is much easier said than done.

What I've done is acquired properties subject-to the original mortgage: the difference being, I don't have to ask the bank if  I can do it, I just do it. That's the beauty of subject-to, you don't have to qualify for the mortgage.

I actually wrote an article about Subject-To awhile back that you might appreciate:

https://www.biggerpockets.com/renewsblog/2016/07/0...

Best,

Dave

Shane Jeanfreau · Answer

thanks for all y'all's input! I'm assuming subject to is almost like a bond for deed in Louisiana. I'm already in the process of refinancing a duplex I have so it would be extremely closed to pick up another loan right now. Subject to seems like the way to go.

Matt H. · Answer

Yes I have done it a couple times. Some loans can be assumed for a point or so with some underwriting, most cannot. I have been involved with the ones that cannot. You just have to remember they all have a due on sale clause. It has been my expieriece with a variety of banks over a variety of years that if you pay they won't call it. But I am sure it happens. So you have to be prepared for that. And regardless of the route/structure you take there is substantial risk for the seller that you won't pay and their credit will suffer. So in every deal I have done the seller knows me or of me and trusts I will pay.