Are you currently in a position where you’ve been trying to sell your Virginia Beach, Norfolk or Chesapeake home, but aren’t having any luck in today’s real estate market? If so, then you might want to consider the option of selling your house subject-to the existing mortgage. By doing so, you can get your home off yours hands more quickly and in a more affordable manner. Not sure what a “subject-to” home sale entails? Read on to learn more.
What is a “Subject-To” Mortgage?
Essentially, a “subject-to” mortgage is any mortgage that includes a special clause stating that the home sale is dependent on the buyer or seller meeting a certain stipulation. The most common stipulation found in a “subject-to” mortgage is that of the buyer completing a home inspection.
However, with a home sale that’s subject-to an existing mortgage, what this means is that the buyer of the home takes over the title to the property, but the seller retains the mortgage itself. Essentially, the buyer makes payments on the home loan just as the seller would have, but there is no legal transfer of the mortgage from the original owner’s name into the new owner’s name.
What Are the Benefits of Such a Mortgage?
Of course, you might be thinking, “why would I want to trust somebody else to make my mortgage payments for me?” First of all, if you’re thinking about selling your home subject-to your existing mortgage, you’ll definitely want to make sure you do so with somebody you know and trust to make the payments. After all, if a payment is missed, it will be your credit that is adversely affected.
On the other hand, when you sell your home subject-to your existing mortgage, you can enjoy a number of benefits. For starters, with such a home sale there is no need for an appraisal or closing costs, since there is no transfer of mortgage holder. As a result, home sellers can save thousands of dollars. Furthermore, the process of closing on a home with subject-to existing financing is much quicker, which is great for those who may have otherwise had a hard time selling their homes in a pinch.
For example, let’s say you’re trying to sell your home quickly, but you know it needs some work. As a result, you’re having a hard time finding serious buyers. At the same time, you’re already in the process of moving, so you want to get the burden of your existing home off your hands as quickly as possible. This is where a subject-to sale can be a huge benefit.
What Are the Necessary Steps?
If you’re interested in selling your home subject-to its existing mortgage, the first thing you’ll need to do is to find a reliable buyer. Generally, these types of buyer area real estate investors who have a lot of experience in creative financing. If your investor has a proven track record, you will have a lot more confidence that your mortgage payments will be made each month in a timely matter, and that your credit score won’t have to suffer as a result. In fact, your credit score will probably improve!
Once you’ve found a reliable buyer, all that’s left to do is to sign a contract and transfer the title of your home over to the new owners. From there, you can enjoy the peace of mind of having your mortgage payments made without the need for a lengthy closing process.
If you’re interested in selling your house subject-to the existing mortgage and looking for a reputable, experienced buyer, please contact us today. We’re interested in all homes in Virginia Beach, Norfolk and Chesapeake, regardless of their current condition. Let us help you get your home sold as soon as possible.