07/18/2024
Many people are starting to ask me about subject-to deals.
Usually the #1 Question.
If you are the Seller...what happens if they Buyer stops paying?
Let's take a look at a scenario. It's year 3, and your Buyer has lost their job and can no longer pay.
You took $40,000 as the initial down payment. In 3 years, the mortgage has been paid down by the buyer an additional $7,000. In that same time, you home has appreciated $40,000.
So you would foreclose, (or other processes) and now you are allowed to resell your home again.... and you've come ahead $87,000.
You don't want your buyer to come under these circumstances, but if setup correctly, reclaiming your property can be a positive.