Is this structure correct.

I have a client with a property with a $70,000 mortgage but is behind on his mortgage about a year. He wants $7000 to walk away. The home needs about $25,000 roughly in updating. Top out for home sales in this neighborhood is $120,000. He is willing to leave the mortgage in place for five years. Would a subject to structure work in this instance?

I don’t know what this guys payments are, but consider the cost to reinstate the loan with all the penalties and fees, and the 7K he wants and the 25K in rehab money and the 70K loan.

And he’s got the kahonas to demand $7,000 and force you to refinance in 5 years?

This guy is treading water with a cement weight tied to his feet.

Run far and run fast and don’t look back.

Thanx Randoskie. Is there anyway to make this work. Like $1000 or less to the seller in addition to the five years or longer mortgage remaining in place?

This deal sucks. Even if he gave it to u and walked away with no money I wudnt take it.
If he was current on his payments and taxes, it would be workable, barely.
Know when to say, NEXT. There are much better deals out there without taking on this shitstorm.
If your going to do Sub To’s, find ones that are in great condition and payments are current or not more than a few payments behind. And dont worry if they are underwater, if you have the financing in place it will sell.

Gotcha! Thanx!

Since the deal he wants really does suck from your perspective, and if he’s a year delinquent, a sheriff’s sale has gotta be on the near-term horizon, you might wanna suggest a short sale, in which case, he would legally get nothing at closing. Then, magically, any other scenario you offer him will appear much more attractive in your Seller’s eyes.

Incidentally, I’m in Philadelphia as well; my focus is on Northwest (Chestnut Hill, Mount Airy, Germantown, East Falls, Roxborough, and Manayunk) What part of Philly do you focus on?