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  • Writer's pictureDaniel sisto

The Benefits of Selling Your Real Estate "Subject To" the Existing Mortgage

Subject 2 Real Estate

The word mortgage literally means "death pledge.” I'm sure that most would agree; this is an incredibly disturbing thought. However, being a mortgagor/debtor under a mortgage doesn't have to be this grim! There is hope! Unlike a captain on a sinking ship, you do not have to sink with the vessel that is your mortgage, there is a life boat available for you to jump in, and it’s called “Selling Your Property Subject to the Existing Mortgage.”

There are many different reasons for wanting out of a mortgage: Some people are having financial difficulties and are struggling to make their monthly mortgage payments, others are already behind on payments facing foreclosure, or are behind on their property taxes. Some can't afford to keep up with costly property maintenance, while others have been told that their properties need too many expensive repairs or upgrades before selling. Some folks have emotional reasons for wanting to get out from under their properties, whether it be due to divorce, or a death in the family. Others have inherited properties with a mortgage in place that they cannot afford to keep paying along with the taxes and insurance every month. Some seek relocation for employment reasons, while others look to transition into senior living facilities. Others are simply looking to downsize, while some wish their children could grow up in a better neighborhood or desire to have their children attend a better school district. Finally, some people just want to move without their mortgage getting in the way.

No matter the reason for wanting out of your current mortgage, we can help!

HS Property Funds purchases properties subject to existing mortgages in as little as 14-30 days!

What this means is, HS Property Funds will free you of the burden of paying your monthly mortgage payments, as well as the costs of maintaining and repairing your property, in exchange for title to the property. In certain instances, depending on the property and the circumstances, HS Property Funds will also offer additional cash, which you will receive at the property closing to assist with your relocation process.

How it Works

HS Property Funds will set up an appointment to do a walk-through of your property. At the walk-through, we will take some pictures of your property and find out as many details about the property and your situation as possible. We will then use these photos and this information to conduct a FREE ANALYSIS of your property to determine how much we can offer you. In order to complete this analysis, we will need to see your most recent monthly mortgage statement. This will help us determine how much it will ultimately cost us to hold the property so that we can finalize our offer for you.

While HS Property Funds will receive title to the property, your name will remain on the existing mortgage until we either resell the house, refinance the existing mortgage, or pay off the property’s remaining principal mortgage balance.

As you can imagine, this sort of transaction requires the seller of the property to have a high level of trust in the buyer.

Why Should You Trust Us?

HS Property Funds has been in business since 2014, and has successfully completed hundreds of real estate transactions. Our company has helped many property owners out of countless difficult and unique situations since its inception. HS Property Funds has built a very strong reputation in the Central New York Community and seeks to protect and enhance this reputation by providing extra transparency and keeping sellers informed throughout the entire process.

In terms of a “subject to” transaction specifically, it is in our best interest as a growing real estate investment company to make all mortgage payments and to do so in a timely fashion for multiple reasons:

  1. One of the first things we will likely do upon acquiring title to the property is make repairs and upgrades to the property. If we stopped making the payments, we would lose all funds that we expended in renovating and remodeling the property along with any equity that we added to the property.

  2. It is also in our best interest to fix up the property and either resell, or refinance as soon as possible. The quicker we do either of these things the more income we will generate from the property, because the longer we hold on to the property, the more we will have to pay in holding costs. When either of these events occurs, your entire mortgage balance will be paid in full.

  3. As mentioned above, we are looking to enhance our solid reputation and build credibility in the Central New York Community. A company can only accomplish these goals by keeping its word and by genuinely seeking to help its clients.

HS Property Funds will set up automatic payments which will transfer the funds necessary to pay the entire monthly mortgage from our company’s bank account directly to your mortgage account every month on time. We encourage our clients to set up an online banking profile with their mortgage company if they haven't already done so, so that they can see us making their payments on time every month.

We have streamlined this entire “subject to” home selling process by creating a packet of all of the documentation required to complete these type of transactions, including all documents the seller would need to send their mortgage company, in an effort to make this home selling method as simple and straightforward as possible for our clients.

This real estate transaction will be reduced to writing in a simple, easy to read contract, so that both parties are legally bound to whatever agreement we have reached. Additionally, this entire transaction will be conducted by licensed attorneys to ensure the utmost legality and ethicality. We also encourage our clients to review all documentation and contract information we provide them with, with their own independent legal counsel, this way they can move forward comfortably and confidently, knowing that their own attorney has approved of the transaction.

In an effort to create further transparency with our clients, we also share any inspection reports and repair estimates with sellers, so that they can understand how we arrive at our purchase offer, and to give the sellers the advantage of acquiring reports and estimates that would normally cost them hundreds of dollars to get. This way, even if you decide that you don’t want to accept our offer and work with us, at the very least you will gain valuable knowledge and information on the condition of your property and the necessary repair costs.

Below is a testimonial straight from one of our most recent clients who sold us his property subject to the existing mortgage on the property. We took over his monthly mortgage payments, all of the headaches of fixing up the property, maintaining the house and freed him of these burdens. We were even able to provide him with an additional few thousand dollars in cash at the closing to assist him with his move. Here is what our client Brian had to say about working with us and selling his property to us in this “subject to” manner:

Brian’s 3 Bedroom Townhouse in Liverpool, NY

Caleb Thurston

Acquisitions Manager

HS Property Funds, LLC

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