So you want to “sell my house fast” but have an existing mortgage? We can help. No problem! If you have not heard of subto or subject to, we’d like to introduce to you the concept of a Subto or Subject to deal and how you can benefit from it because we always come up with win-win solutions for homeowners who need to sell their house fast.
The Subto or Subject to concept has been around since the 70’s and early 80’s. It was pretty common back then when interest rates would go up each year. The terms Subto and Subject to are shortened versions of the actual sale agreement that would be “subject to the existing loan” owed for or on the house. What will happen in this type of deal is the buyer will take over the mortgage payments for you.
Get A Cash Payout
Yes, you can still get cash in your pockets on a Subto or Subject to deal. Professional home buyers like us, Rusty and Susanna, offer a down payment or a cash out aside from taking over the loan to close the deal. This cash amount will be exclusive of any closing fees or commission so that would be a fair value straight into your pockets.
Be Free From Mortgage
Since the buyer will take over the loan they will be the ones to pay the bank or the lender as part of the subto or subject to purchase agreement. When the buyer takes over the loan they will refinance it and the loan that was still in the seller’s name disappears. A refinance pays off existing loans. That typically happens between three and five months after the initial purchase. The other way this loan disappears is when the buyer does repairs and rehab work to increase the house value and then sells it to another buyer. In that next transaction, the loan gets paid off and you become free of your mortgage in a short period of time.
Taxes And Insurance Are Covered
Taxes and insurance will become the buyer’s responsibility in a subto or subject to deal. Since the title goes to the end buyer, the payments are escrowed and there are never any issues with them. The payments are automatically made each month, just like a normal first mortgage.
Get A Higher Offer
With a subto or a subject to deal, house buyers can offer higher purchase prices to sellers because they will be able to use the existing loan. Instead of getting a cash offer that may be below EMV, which may not even cover your current mortgage, you can get a good purchase price on your house.
Have A Safety Net
You might be worried about what happens if the buyer stops paying the mortgage. Let us assure you that this scenario rarely ever happens because buyers have more to lose that way. As a safety net you as the seller can actually take the house back from the buyer. This will be included in your purchase agreement.
Avoid Foreclosure
If you are behind, underwater or upside down on your mortgage, you can get benefit from a subto or subject to deal to avoid foreclosure. Foreclosure can affect your credit report for seven years and every homeowner avoids that.
You can also watch my YouTube video on the concept of buying a house subto or subject to the existing loan from an investor’s standpoint.
Rusty and Susanna of Pinal County House Buyer have been in the business of buying houses for more than a decade and you can benefit from their experience so you can reach your goal to “Sell my house fast!” Just give them a call at (520) 261-6116 or send a message to discuss your situation and come up with a win-win solution.