I was wondering if you guys are still using Trusts when buying Sub2s. There has been a lot of negative talk about LT and would like to know if sub2s are being affected by it.
Thank you
i don’t use them. trusts can tend to make the transfer look like a deliberate concealment of the new owner for the purpose of preventing the DOSC from being invoked. Sometimes the lender sees it that way but having said that, today with all the defaults I don’t think that any lender will turn down the opportunity to keep a note servicing properly. Just my view.
Great!!
But just for the record how or do you tranfer title without triggering the Due on Sale Clause?
Thank you
There are endless posts on this board about this. The DOSC is NOT LIKELY to be invoked if you keep making the pmnts on time, all the time. Don’t put any flags out there. Ask John Cash from these boards, 500 or 600 S2’s and NEVER a loan called.
as i have said b4, lenders are not calling DEFAULTED loans due these days lol
There is alot about the due-on-sale, best I have seen is bp by financexaminer, he has over a thousand and was a bank examiner. According to him, he always disclosed the sub2s and never had a problem. I have done some sub2 as installment deals and that worked fine in my LLC.
Hi BJ,
I am kind of new in this forum and don’t know who the heavy players are. It seems from what you said Financexaminer has been around the block a few times! So if I understood correct he calls the lender and tell them he is buying the propery subject2, transfering title, etc., and they are fine with it???
Thank you
would u tell a hit man how u want to be offed? I would NOT call the lender and tell them anything. It’s been my experience that if you pay notes on time you do not get phone calls from the lender. read the 2nd sentence from my post above.
“Would u tell a hit man how u want to be offed?” Lol!! That’s great!
Yeah Tony’s right! You want to lessen any chance for a due on sale occuring.
I find the main culpret for triggering a DOS are sellers trying to re-finance
the property under you. Then they will play dumb when the lender sends out
his hate mail. You must have control of your sellers in order for this
to work.
I find that completely disclosing everything to the sellers and letting
them know the property will not be sold for at least 5 years AND have them
sign paperwork to that effect will lessen the chance of this happening.
Otherwise, about a year or two after closing they’ll
start inquiring about the loan…funny they didn’t seem to care when they
were 3 months behind.