Is this Illegal? - Posted by Jim
Posted by Jim on February 05, 2001 at 18:31:47:
You know when a seller has to eliminate a debt such as an existing mortgage in order to qualify for another one?
If I were to buy the house from this seller on a Lease Option Agreement, that seller would receive credit for 75% of that liability as far as his lender is concerned, because rentals require maintenance and that 30% would be alloted to cover that expense.
If I were to buy his property on an Agreement for Deed the lender would credit him with 100%, because it is in fact a sale! (Correct me if I’m wrong on any of this)
Now if I were to take title “Subject To” this would mean nothing to the lender correct?
Here’s what I am asking that is a bit twisted.
Can I buy the house “Subject To” (Between me and the seller) but just so he can get his new loan and show that his mortgage is being serviced through a sale…Make an Agreement for Deed for him to produce to the lender and then trash it after he gets his loan and just do the original agreement of the subject to???
Or would it be safer to just do an agreement for deed and buy it that way?
The only reason I ask this is because I would always want to get the deed if possible.
Thanks for your input