Assignment of Mortgage

Hi, I found my first homeowner willing to assign their mortgage to me. However I’m not sure of the wording for the assignment of mortgage. Are there any forms that I can get my hands on right away? I’ve spoken so far with two homeowners and it looks like the second one is willing to do the same. Please help!!!

Use your standard contract (state RE) and under financing check subject to. Print up a simple authorization form for the home owner to sign to let the bank release loan information to you. You need to see what you are actually getting into. :cool

The homeowner CANNOT assigne their mortgage to you.

You may enter into a contract to take the property “SUBJECT TO” the existing liens and encumberances of record.

The lender will have the right under the due on sale clause to call the loan with any change of ownership to you.

Whether the lender choses to exercise this right is entirely up the the lender. Some will, some will not…you pay your money and you take your chances.

Heed Bill’s advice, I just recently was in a coffee shop chatting with another investor when a guy came up to us and asked are you guys in real estate. Turned out he was a newbie investor, bought a “mortgage assignment” home just like the guru said, and then got the Letter from the lender, the due on sale was being enforced. He said how can that be I had the seller assign the mortgage to me. I for one would like to see that term abolished on any investor site. So we explained that sellers cannot assign their mortgages. Only lenders can assign a mortgage they hold to someone else, generally another lender, or allow it to be assumed by someone or taken over without exercising the due on sale clause. The seller has only one right, to pay it off when there is a due on sale clause in place.

Always thought the banking industry was totally stupid in this area, having a loan taken over by someone better able to make the payments should be a good thing. Maybe a fee for the extra paper work change as extra income to the lender as a bonus. I know in loans I have made I don’t have a due on sale clause, I have a interest rate will be raised to the current market rate upon change of ownership or remain at the existing rate, whichever is higher.

The supposedly the big complaint of the banks, was they wanted higher interest if the current rate was higher, so they didn’t really need a due on sale clause, just my clause. And if I am not notified of a change I can go back to the time of transfer of title and get that addition interest due, a due on sale doesn’t do that. I also keep the original borrower liable for the loan as well as the new party. Maybe banks need to look at the due on sale clause again. If the borrower doesn’t pay you have to foreclose if there is a due on sale or not but I guess banks like having a big stick available no matter how useless it really is to them.

There is no such thing as “mortgage assignments.”

There are “mortgage assumptions,” but these are like qualifying for new loans, and represent no shortcuts, and practically no advantage for a buyer.

“Mortgage assignments” are reserved for the crooked, or stupid, and you decide which shoe fits.

Meantime, there’s a right way to take title subject to, and the way that gets your loans called due.

None of the ways so far discussed is the right way.