Buying or Selling Subject-To: A Good Idea for Investors?

Liz Brumer-Smith, The Motley Fool
·3 min read

The exact terms of a subject-to scenario can vary greatly, but most require some sort of down payment in cash to the seller, with the buyer taking over the current payments, or possibly paying slightly more because of a wraparound mortgage. Buying property subject-to can be a great way to structure a wholesale deal or flip so you don't have to waste time getting a mortgage approval or tie up your credit for something that will quickly be in another person's hands. In this case, you buy the property subject to any existing financing, maintain the monthly payments according to the terms of the loan, and pay off the balance once the property sells.