Closings & Subject To's - Posted by Bill

Posted by John on May 26, 2006 at 07:22:28:

I sent the letter to the address that the lender provided for other corrospondence. If you look at the mortgage payment bill, it lists 4 addresses; 2 for payments, 1 for insurance and 1 for other.
I did not include the POA. The payment bill is now sent with the sellers name and my company name to my address. No I never signed anything that assumed the loan and it does not appear on my credit report. This is a national lender that is wide

Closings & Subject To’s - Posted by Bill

Posted by Bill on May 25, 2006 at 12:03:39:

I have a few questions in regards to subject to deals. Are there closing proceedings when purchasing homes Subject To or is it a simply a matter of getting the deed to the property & recording it using the landtrust vehicle? Thank you in advance for your advice,


Re: Closings & Subject To’s - Posted by John

Posted by John on May 25, 2006 at 13:20:08:

It can be that simple, but you leave yourself wide open.
I pay for a closing at the title company or attorneys office. One more step to prevent seller from claiming they never intended to sell the property. It also makes sure everything is done legal and correctly.

Re: Closings & Subject To’s - Posted by Bill

Posted by Bill on May 25, 2006 at 18:06:31:

Wouldn’t that alert the lender to title transfer & therefore trigger the due on sale clause?

Re: Closings & Subject To’s - Posted by John

Posted by John on May 25, 2006 at 21:27:17:

There are two schools of thought on this. I have done it both ways and it has worked fine for quite a few years.

  1. Recomended by John Hyre, send a certified letter to lender and inform the of the change and that you are taking over the property sub-2. If they don’t call the loan after 6 months they can no longer call it. When I did this I have heard nothing and it has been 4+years now.
  2. Is more common the use of land trusts. Set up a trust for the seller. Record a deed to trustee. Have seller sign an unrecorded assignment of benifical interest to you or your company. The property is now yours but your name does not appear on public records. If you have never done this I would suggest Bronchick’s land trust to walk you through it step by step or get an attorney to do it for you.

Re: Closings & Subject To’s - Posted by MMNC

Posted by MMNC on May 25, 2006 at 19:07:45:

If done correctly…No!

As long as the seller remains a 10% beneficiary within the land trust then the lender cannot call the loan due. The deed will be titled to a trustee and then recorded. No actual transfer of ownership there. The Assignemnt of bene interest and trust agreement is not recorded. Thus the protection of the Land Trust/Trustee. You would only need to ensure that you get a Limited POA from the seller so that you can vote his/her share of Bene interest in the future without needing their involvment.

Re: Closings & Subject To’s - Posted by lil-pa

Posted by lil-pa on May 26, 2006 at 06:25:31:

Hi John,

This may sound dumb but… to whom at the bank did you send your certified letter to? did you also include a copy of the POA?