Other than being able to sell a property that would other wise be hard to sell at the current ask or amount owed by the homeowner, what is the advantage for an owner to do a subject to mortgage.
Does anyone have a copy of a letter to send a prospective seller as an introduction?
Sometimes a seller has a circumstance that compels them to leave. It could be an illness, a job loss or change, a divorce, a partner who went to jail, or just too many expensive repairs for them to fix themselves. The idea is to market to an area, and then be there to solve problems and offer options that will benefit them. It is one thing to have late payments on their credit, but a foreclosure will stick for a long time and is harder to bounce back from, emotionally as well as financially. When that tipping point is reached for them, a seller will just want to walk away.
In the past, I have presented three "ways" I can buy their house: Fast, Medium, and Slow. Fast is no repairs on their part, quick close and sub2. They still need moving money, deposit for first and last months' rent, and some agreed amount more (depending on their needs). Medium can be a lease option, where you control the property and do not go on title until you buy at a later point. And Slow is a conventional mortgage, where the house must meet standards set by conventional lenders, which means no great fixing, no bad roof, etc. I must include closing costs, origination fees, inspection, appraisal, which means that there is less money in the deal, and less to offer the seller.
When you are talking with a seller, you are negotiating directly with them, trying to find a path that works for you and your goals, as well as a path that works for them and their goals. Normally there are agents in the middle of this. You need to have empathy and compassion, while you listen to what they need. Often they do *need* to sell fast.
SO...read over what I have written and write from your heart a letter that shows you are thinking of their need to sell fast. And without repairs. And get rid of a problem house. You are not there to take advantage of them, but to work out a deal that makes sense for both parties. I have had a local lawyer draft up a purchase agreement, or obtained (from a lawyer or title company) the local template from the Association of Realtors in my area, rather than one from a guru course. And I close at a title company, not at a kitchen table (I have done that, but I don't think it provides enough closure for the seller, as it doesn't feel "real" to them.)