{"id":343,"date":"2022-04-08T16:45:39","date_gmt":"2022-04-08T16:45:39","guid":{"rendered":"http:\/\/mn.arenter.com\/coach2\/?p=343"},"modified":"2022-04-08T16:53:15","modified_gmt":"2022-04-08T16:53:15","slug":"buying-a-home-with-no-credit-or-downpayment","status":"publish","type":"post","link":"http:\/\/mn.arenter.com\/coach2\/2022\/04\/08\/buying-a-home-with-no-credit-or-downpayment\/","title":{"rendered":"Buying a Home with No Credit or DownPayment"},"content":{"rendered":"

What is Sub2?<\/h3>\n

Buying Subject 2 is short for Buying Subject 2 the existing mortgage, which means that the buyer is not getting a new loan, but they are taking over the financing that is already in place.\u00a0 Taking over the debt that has been established by the seller, the sellers debt, but at the same time transfering the ownership.\u00a0 The transfer of ownership takes place, but the debt remains.<\/p>\n

How is this possible?<\/h3>\n

It’s easy really, and a great way to buy many houses with little or zero money invested into the home, initially.\u00a0 Obviously, there is money invested ongoing with the debt services (the mortgage payments), but ultimately the concept of the debt and the concept of the owner, have no direct point-to-point direct relationship.\u00a0 So ownership can be transferred, but it could trigger a clause in the note called a due-on-sale clause.\u00a0 \u00a0 The the garn st. germain act of 1982 allows the bank to call the note due when ownership is transferred.\u00a0 However, under that same law, there are opportunities for investors to keep the loan in place and capture that low interest rate and no down payment for the purchase of the home.<\/p>\n

Is this allowed, legally?<\/h3>\n

Look up line 503 on the HUD Settlement Statement,\u00a0 that is where the transaction takes on credibility since the HUD Settlement Statement is a government document.<\/p>\n

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So, how specifically does this work?<\/h3>\n

It’s just a deed.\u00a0 The buyer gets a deed to the home, and starts making payments the next month.\u00a0 What is the advantage of this?\u00a0 Many advantages:<\/p>\n

    \n
  1. Lower or no down payment.<\/li>\n
  2. Lower interest rate (usually an owner occupied interest rate)<\/li>\n
  3. If the loan is a little older, you get to capture more principal paydown based ont he amortization schedule<\/li>\n
  4. the debt is not on the buyer’s credit<\/li>\n<\/ol>\n

     <\/p>\n

    What questions do you have?<\/h4>\n

    Can you see how this technique could add a number of homes quickly?\u00a0 Leave a comment if you have a question or would like some help on how to implement this technique into your business.<\/p>\n

     <\/p>\n

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     <\/p>\n

     <\/p>\n","protected":false},"excerpt":{"rendered":"

    What is Sub2? Buying Subject 2 is short for Buying Subject 2 the existing mortgage, which means that the buyer is not getting a new loan, but they are taking over the financing that is already in place.\u00a0 Taking over the debt that has been established by the seller, the sellers debt, but at the […]<\/p>\n","protected":false},"author":1,"featured_media":222,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"pagelayer_contact_templates":[],"_pagelayer_content":"","footnotes":""},"categories":[30,28,25,29,18,5,23,19,24],"tags":[],"class_list":["post-343","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-buying-strategies","category-coaching","category-coaching-tips","category-deal-structuring","category-investor-tips","category-learning","category-real-estate-investing","category-sub2","category-subject2"],"_links":{"self":[{"href":"http:\/\/mn.arenter.com\/coach2\/wp-json\/wp\/v2\/posts\/343","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/mn.arenter.com\/coach2\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/mn.arenter.com\/coach2\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/mn.arenter.com\/coach2\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/mn.arenter.com\/coach2\/wp-json\/wp\/v2\/comments?post=343"}],"version-history":[{"count":7,"href":"http:\/\/mn.arenter.com\/coach2\/wp-json\/wp\/v2\/posts\/343\/revisions"}],"predecessor-version":[{"id":352,"href":"http:\/\/mn.arenter.com\/coach2\/wp-json\/wp\/v2\/posts\/343\/revisions\/352"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/mn.arenter.com\/coach2\/wp-json\/wp\/v2\/media\/222"}],"wp:attachment":[{"href":"http:\/\/mn.arenter.com\/coach2\/wp-json\/wp\/v2\/media?parent=343"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/mn.arenter.com\/coach2\/wp-json\/wp\/v2\/categories?post=343"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/mn.arenter.com\/coach2\/wp-json\/wp\/v2\/tags?post=343"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}