Owner Financing/Wrap-Around Mortgage

[Tim Willie]

I am in the process of completing a deal that will involve owner financing. However, the owner has a mortgage on the home that we are hoping to have remain in place. Do any of you have experience with doing this type of deal, specifically in CA, but in general is appreciated as well. I am mostly concerned about having the existing mortgage become accelerated if I record the transaction. So I'm wondering the best way to avoid having that happen, and if any of you know if Bank of America typically does routine checks on whether or not homes they hold mortgages on have been sold or have a title recorded in a different name.

Thanks for any help.

Tim

[Alan]

If there's a mortgage in place, you will most likely want to do a deal "subject to" the existing mortgage.

There are many places to find the details on how to do this type of deal.
You just have to make sure that you complete all the correct paperwork.
Search for "subject to" or "sub2"

Good luck

[Tim Willie]

Alan Chantker‍  thank you for the feedback. Since your post I have done a little research on writing an offer using the "subject to" method. My two biggest questions are: Does the mortgage company typically accelarate the loan in these instances (Bank of America) and if I have essentially agreed to take over the existing payments as "interest only" payments on my part, would I write the offer stating the current information from the existing mortgage, but include that when we pay off the home (anytime in the next 72 months) that we will pay off the existing loan in addition to the difference between the balance at that time and the agreed upon purchase price of $xxx,xxx?

Again, thank you for any help/feedback you can provide.

Tim

[Alan]

I can't cover the entire scope of what you need to do to successfully complete a "subject to" deal.
However, I can tell you that banks do not typically call the loans due as long as the payments continue to be made on a timely basis.
There's a lot of paperwork involved in making sure that you cover all aspects of the deed transfer and do it correctly so as to no give the bank any reason to call the loan.

You should spend the money to buy someone's course on this topic.
The course should include all the paperwork and step-by-step instructions.

Here is one course that I found.

https://www.creonline.com/catalog/c-286.html

I can't vouch for this since I have not seen the material, but it's only $97 so it's not a huge loss if it's not up to par and there's a 60-day guarantee

Best of luck with this.