All Forum Posts by: DJ Brooks

Jacob- yes subject to mortgage 

Thank you Jamie. I will definitely check it out. I may go through a title company that has a lawyer on staff that said he can draft something up. I've googled some templates but they have things that I don't want in there and some things that are missing haha. I believe i've resorted to paying for help. 

Hello everyone, I am trying to set up a sub-to deal on a listing I have. However, I do not have a contract or template to create an agreement. Does anyone have a blank contract they are willing to share with me? Or does anyone have pace's template? Please let me know. Thanks!  

Quote from @Doug Smith:

Hey DJ, I'm actually in Tampa myself and I've set up several LLCs for our operations. I'll PM you. 

 Thats great doug, I just accepted you. Have you dealt with sub-to before? 

Quote from @Caroline Gerardo:

Walking the line of fraud isn't a good plan and with the seller as trustee if they file BK, divorce, have a judgement it sticks on the property.

 I didn't know that was walking the line of fraud. The info I've been researching says is legal. But that is duly noted. I would want to break the law in any means. I'm speaking with a lawyer about it tomorrow and will bring that up. 

Quote from @Randy Rodenhouse:

Probably best to buy the property in the trust where your LLC is the beneficiary of that trust. That gives you an anonymity
and asset protection at the same time. It also helps you with due on sale clause since the lender will see it was put into a trust for estate planning purposes.  

Thanks for your answer Randy. Yes that is what I am going for as far as due on sale clause. I'm not sure about the LLC option but I am sure I can do that later. Wish me luck!

Quote from @Account Closed:

Quote from @DJ Brooks:

Hello everyone! I am in escrow for a subject-to deal that I will be using as my primary home. I only know the basics when it comes to creative finance. I am worried about the due on sale clause as most people are who are purchasing a subto property. I need advice. I've heard a trust is the best way to structure it. But someone mentioned an LLC would be better. What are your thoughts? I also need referrals for attorneys who can help me with this on the fly! And not too expensive haha. I'm in the Tampa area. Thanks!!

He chose poorly. 

 That's good to know. However Pace has 1,000s of properties with creative finance. So those odds are pretty good haha. 

Quote from @Account Closed:

Check out https://www.noradarealestate.com/blog/due-on-sale-clause/

in general putting the property into a land trust should not trigger the due-on-sale because of the Garn St Germain Act. We did this with our property and had no issues with our bank. The best part is you can later (and privately) make your LLC the beneficiary of the trust if you'd like.

But always check with your lawyer 😊

One other thought. If you are living in the home as your primary residence you will probably lose the homestead exemption if you put it into a trust or LLC. Definitely check with your lawyer on that.

I didn't even think about the homestead exemption. Thanks for pointing that out. Yes, I am somewhat elementary with trusts and LLC's. The only big risk for us is the due on sale clause. Thanks  for your reply! Big decisions this week for sure haha

Quote from @Caroline Gerardo:

LLC or Land Trust vesting is never stopping the existing lender from calling the loan, in fact the opposite, it may trigger it. Changing the deed is a SALE, the loan is due on sale. Or what are you planning?

Best practice is to have equity that you can sell if this happens or you are positive your W-2 income, good credit and equity position will allow you to refinance fast to another lender in the future if this happens.

 Yes the reason I am doing a sub-to is because I don't quite qualify. I know it doesn't fully protect me for the lender calling the loan... but as far as recording goes, the seller would be the trustee so it would be his name recorded instead of mine. Just an extra layer for the lender to unfold. Doing the math, I would lose 16k if they called the loan the very next day. I should be able to qualify by next year. I just moved here so i cannot qualify just yet. But keeping the 2.75% interest is definitely something I'd like to keep haha

Hello everyone! I am in escrow for a subject-to deal that I will be using as my primary home. I only know the basics when it comes to creative finance. I am worried about the due on sale clause as most people are who are purchasing a subto property. I need advice. I've heard a trust is the best way to structure it. But someone mentioned an LLC would be better. What are your thoughts? I also need referrals for attorneys who can help me with this on the fly! And not too expensive haha. I'm in the Tampa area. Thanks!!