To do or not to do Subject-To

I want to briefly touch on something I get asked about all the time… especially on my podcast phone hotline.

Subject-to deals.

To be honest, I’m personally not a huge fan of this strategy. :-/

I’m not saying you can’t or shouldn’t do it, you just need to make sure you’re doing these types of deals the right way.

See, a lot of investors get confused when it comes to putting together a subject-to deal.

And that’s because they really can be difficult deals to do.

Why?

Well, one big reason is because you have to take over the deed. That just complicates the whole process and adds another big step.

Another reason to be cautious is because you’ll be working with a seller who’s gotten wayyy behind on their mortgage payments… and they may not be so emotionally stable and rational.

So, those are 2 reasons why I steer clear, but…

Since I think subject-tos are so iffy… I do want to give you a couple alternate suggestions so you don’t ‘lose’ the potential deal. Part of succeeding in this business is thinking creatively to get deals done:

  1. Instead of doing a deal as a subject-to, do it as a short sale: find someone in the area who does short sales (another investor or maybe even a Realtor) and offer to give them the deal if you can be the buyer
  2. If you still want to give subject-to a go, I strongly encourage you to partner with an investor who has done it

And remember, you don’t have to do these deals with a 50/50 split…

See if you can find someone to partner with for a 60/40 or even 70/30 split. Give it a shot.

Final Pro Tip: Subject-to deals can be super tricky. Always make sure you are working with an experienced title company and attorney.

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