"Subject To" - Posted by Mike

Posted by Stacy (AZ) on January 31, 2001 at 13:41:41:

Mike, in addition, you don’t have to qualify if you do a subject-to. The lender will make you qualify for an assumption, for the vast majority of mortgages that are in existence today. There are still some no-qual assumables around, but they’re rare.


“Subject To” - Posted by Mike

Posted by Mike on January 31, 2001 at 11:55:57:

Isn’t doing a “Subject To” deal the same as assuming the loan as far as me taking over the existing loan.

Thanks, mike

Re: Nope - Posted by Stacy (AZ)

Posted by Stacy (AZ) on January 31, 2001 at 12:55:47:

Mike, assuming a loan through the lender places the loan in your name, with you accepting the liability, and with the loan being reported against your credit history. It also costs money to assume a loan this way.

Getting the deed subject to the underlying loan gives you ownership, but keeps the seller’s name on the loan, and on his credit report, even though you promised to make the payments on his loan. If something terrible happened, and you couldn’t make the loan payments, your credit history remains untouched, but the seller’s credit history would be in jeopardy. I’m definately not recommending that investors stop making payments they promised to make, but if you had no choice, your credit would not be affected. You could deed the property back to the seller if that would help.