Posted by phil fernandez on November 25, 1998 at 15:42:29:
Subject to the existing loan would mean that you are buying the property with the existing loan staying in place. In other words the existing loan stays in the sellers name and the seller is still liable for it. Probably a good idea to set up an escrow account so your payment goes to this account and out of this account a check is cut to the original lender of the mortgage that is subject to the contract.
You do not formally take over the loan and the bank is not involved. Again Bronchick can explain this much better than I can.