Answers to Today's Real Estate: How to assume a non assumable loan

Monday, September 13, 2021

How to assume a non assumable loan

This technique is called Subject To. Means assuming a non-assumable loan and keeping the loan in the owner’s name. This technique works when you ask “will you sell for what you owe?” If they say “Yes”, you have a “don’t wanter”. These kinds of people may believe that home ownership is not for them anymore. They may hate the banks. They may have an urgency to get out. Doesn’t really matter what their reasoning is, if they answer “Yes” to the question, hit them with this technique.

Here is how I explain the strategy to them: Mr. Seller, I would like to take over your loan for a short time. My goal is to repair and resell the property quickly. In doing so, I will need a few years to complete the project. If you can allow me to take over your loan, (I have all the documents), then you can move now and I will start making the payments. This will increase your credit and get the burden off your back and we can do all this today. What do you think?

Obviously, you must want the loan and can afford to make the payments. There are more than one exit strategy. Fix and flip is not the only one. I use it here for easy of explanation to the Seller. What are some of the reasons that you would want someone else’s loan?

. No bank qualifying

. Easy, takes very few documents

. Payment is much less than what you could get in rent

. Wouldn’t it be great if you didn’t have to buy the property, someone just gave it to you?

. The ultimate in owner financing