how would you describe doing a subject to to a seller?

7 Replies

and how would you describe doing an option with the seller?

i want to start doing these, but dont know how i would explain this to someone selling the house

You could call it:

"take over payments"

"Owner Financing"

"I'll make the payments on your loan"

"Buy the property 'subject-to'  your existing loan"

Most realtors would say:

"Seller Carry", or "Carry-back" - Often creating a new note. 



Check out the podcasts.  The people that do subject-to usually go through the different ways they phrase it to the seller and I think you'll find what you're looking for.

This is excerpted from an email I sent to the seller for my first deal, a sub-to.


A sub2 means the house would be totally out of your hands. The mortgage would stay in your name, which I agree is weird, but it is a legal agreement that is set up with an attorney. You would have to find an investor you trust. I have three years of experience as a landlord/investor, but I've been a homeowner for eight years, and we've never had a late payment. You'd also be welcome to check my and my husband's credit. You would continue to reap the credit benefits of on-time mortgage payments, but be free of the house.


If you do end up wanting to make all the fixes, cleaning, and selling it through a realtor, take a look at this calculator.

If the house were fixed up and in show condition, with a sale price of $130,000, after realtor fees and closing costs, it looks like you would clear about $7,000. You need to subtract the costs of getting the house ready to sell, though, which I know from experience is a lot. Your average non-investor generally wants a pristine house with updates.

Good luck with whatever you decide! I'd still like to see the house and talk to you about it when you have time. I hope your week gets better. :)

you can tell them that you are going to take over their payment but please tell them that the loan will still be left in their name and you do not know when it will be out of their name or guarantee them a time frame of when the loan will be out of their name.

When you do a subject 2 make sure they understand the bank could call the note due and make sure you give the seller some walking money.

Joe Gore

The important point is disclosure disclosure disclosure. Make sure they understand the benefits and the risks. I would even have an attorney write up a disclosure statement stating that they understand the "due on sale" clause. 

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