Your question is hazy to me. However, lenders have in their documentation the right to pay the delinquent property taxes and senior obligations to protect their situations. They then can demand a repayment from the property owner and, if they are not reinbursed, start a foreclosure on their loan.
Institutional lenders have “tax services” that watch for delinquent property taxes on the properties against which they have loans. A private lender is smart to check in the county tax collectors/treasurer’s office to be sure taxes are paid.
I agree with Anne. Selling Sub2 makes no sense. Selling on a L/O or selling on a wrap, now that makes sense. Too many risks of just giving someone a home when you have no control. If you sell “sub2”, you have NO control. You’re out of the loop.
If selling sub2 makes no sense for a seller, why is it such a popular topic here, and why is it advocated as an ethical way to buy properties? Im not trying to put it down, but Ive seen several posts where people have said the same thing as you.
Because the only person/seller who would do this would be someone in a situation like;
A house has no equity.
Monthly mortgage payments are higher than most people in the area can afford.
Refi/home eq is not an option unless you like negative equity and selling the house is hard because this market never saw a real estate boom in the first place.
… refinanced a few years ago–I squeezed the equity right out and spent the money on all sorts of good things.
Someone like this in a desperate situation may not care at this point as long as someone makes those payments.
There’s quite a bit of difference between me BUYING sub2, and SELLING sub2. I pick up almost all my properties sub2. But, I have never sold sub2.
Not sticking my head in the hornet’s nest of ethics. Suffice it to say, I believe that I always work in the best interest of the people who’s mortgages I “acquire”.