How to Take Over House Payments - Part 1

How to Take Over House Payments - Part 1

How to Take Over House Payments - Part 1

When you take over payments and purchase a home "Subject To", this is how it will very likely go for you. First, for anybody who does not understand what a "Subject-To" purchase is, it is whenever you simply take over payments on an existing mortgage with an informal Transfer of Deed. That's it! The home now becomes yours. This is an informed real estate investors best kept secret.

Doing your first "Subject-To" purchase may be scary, however it is also a whole lot of fun! When the real estate teacher stood before the class and said, "having a home deeded to you is rather simple" everyone in the class, including myself, thought he was a little crazy.

Well, he was correct! Second to paying cash for a home, this is the easiest way to buy a home. You just need to survive the fear of your first time! After you have carried out many of these, it just becomes second nature.

This is the way the flow will more than likely go for you:

1. Seller will in all probability contact you from one of your lead generating efforts. You will pre-qualify them on the phone the most effective way that you can so hopefully you won't waste your time travelling to their residence. You need to have a good idea if the home feels like a fit, and therefore the seller should have an idea of what you will propose before you even get off the telephone with them. Moreover, you ought to have a "close" approximation of what "they say" is owed on the house.

It is best not to mention that you desire to take over payments over the phone. Hold off untill you are in person for that conversation.

2. Prior to going to the property, you'll want to prepare yourself. You need a stack of comparable sales (comps), in order to compare the house with others around the neighborhood in order to uncover the actual market price of the home.

You can get comps by contacting a local Title Company or maybe a Closing Attorney. When I first started out, I received comps from the Customer Relations Department at "Stuart Title". Once you know precisely what the house is worth, then,

Drive to the house to meet with the owner of a house and to examine the home. Should the property needs plenty of work, then it might be best for you to purchase an inspection of the residence.

After arriving at the home and getting comfortable with the seller, that is when you would talk to them about wanting totake over payments and buying Subject-To". If I can make the deal, then I would sign a Sales Agreement on the spot, along with all of the supporting documents. However, many of you will likely not feel comfortable enough to do that. So I suggest that you talk with the homeowners and get comfortable together.

Another thing that you will need to do is determine the "EXACT" pay off amount of the loan. AND, you need to find out if there is a pre-payment penalty attached to the loan. The only way this can be done is to have the sellers sign an Authorization To Release Information Form (ATRIF). Then call the lender on the seller's behalf, fax over the (ATRIF) and get the EXACT payoff amount.

We will continue our discussion in Part 2:

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