I can assure you they just simply don’t know what they’re talking about. Most and I emphasize most realtors have no clue to life outside of what they’re were trained or brainwashed by their brokers.
Next time a realtor tells you that, ask him to explain lines 203/503 on the HUD1 form. Chances are they have no clue. An agent friend of mine forwarded me the section in the Realtor training manual where it mentions sub2’s and he said they covered it as quickly as you can read the short paragraph.
There is also a good chance you’re not explaining it correctly when asked by a Realtor. They could be responding that way due to your explanation of it. When in doubt, they’ll pull the ‘It’s illegal’ card.
You most definitely need a contract that expresses the terms of a Sub 2 purchase and consequences of default by the buyer. As for an explanation of what one is… That took me about 250 pages in a course I wrote a couple years ago…
To bring it down to size… The easiest explanation is… “Its how I buy Houses” That means that the existing loan will stay on
the house. I will begin paying the monthly payment and making up any back payments and pay you your equity. (NOT) It is not a formal
assumption. It’s the fastest and most economical way to get you your money and your house sold.
I have all of the objection handlers that youll need…
For all I know, it might be illegal in your state. State laws vary.
I can see how a real estate agent might not want to get involved. They have fiscal responsibility, and in a subject-to the bank can call the loan due.
Americans can be such whiners that when things don’t go their way, they never think it is their own fault. Instead, they sue.
So the agent puts together a subject to, the bank calls the loan, and there is a good chance the buyer will sue the agent because the agent should have protected them better.
Not that I think anyone here would sue their agent for something that was their own fault, but there are a lot of amatuers out there who think the world owes them a living. Plus, the guru they bought the course from told them that the world owes them a living.
I belive a lot of people in this time in our country belive some one any one owes them
As it is just the way it is and any kind of a helpping hand is looked at very ify why
With the why are you doing this what is your angle ?
As well i belive if a realtor is not of the full understanding of something they call it scam /illegal
They really do not belive in the saying there is more then one way to do something
I think they think there is only there way /the way they were told in realtor school
Just look how long it has taken realtors to come around to short sales and there are still ones i have talked to that say it is just a way to rip a bank off
Any way any and all help and posttings on this subject have been most welcome
As well any more would be the same
Any one tell me how they have explained the sub-2 to a realtor /seller ?
What has been the most sub - 2 wahy your deals have gone ?
By this iam saying has it been more pre- foreclosures or what ?
As a broker out here in California I can say Agents dont understand Sub 2 deals although until a few years ago it was a check box on our standard purchase agreement…
I have done hundreds of Sub 2 and never have been sued as an investor or as an agent because of one. Keeping in mind anyone can sue anyone… So the real issue is what are you using to protect your interest? I devote an entire page explaining in BOLD type what happens if the deal goes bad… Either because of payment default or DOSC.
A good contract keeps you in the drivers seat… A bad one lowers your checking account
They don’t know what they’re talking about. A fellow realtor friend of mine just bought a sub2 himself a few weeks ago. I’m working on buying one myself right now. Your best bet is to find an investor/realtor in your area you can talk to.
Who in NY State are doing “subject to” What Docs are used in my state to perform this type of buying. also is there a trust set up as well when doing this.
Mike knows what he is talking about…most agents are uninformed!! ‘Subject To’ deals are alive and well and can be done every day, for those who are seeking that type of transaction. Make sure your paperwork is done right. Invest some money on your first deal to get it done right, then you have the paperwork for the rest of your transactions.
I will not do a ‘Subject To’ deal unless the seller pays me money. Mike is right on with this!! If I am taking a seller out of a ‘bad situation,’ he will pay me to do so! I’ve done hundreds of these deals and when you learn how to present this to a seller, he will pay you money!
This type of transaction will make many of us very wealthy over the next 5 years…you can buy $10million in properties ‘subject to’ and resell at full retail…then just manage the property and wait for the market to return. Then resell or have your ‘owner financed’ buyers refinance. I figure there will be 20-30% cash out at that time.
Just remember a couple of things…there are abundant ‘subject to’ deals available…pick those that have equity and the seller agrees to pay you money. Also, don’t jump in unless you have an exit strategy first…rental or resale owner finance, but make sure the market is there in your area. Lastly, work your business with unreasonable requests!!! Seller pays ME to take them out of a bad situation!!!
It is not a formal