Buying houses subject to the existing mortgage (The Big Scam)

This video is about people who are buying houses subject to the existing mortgage. I call it The Big Scam! Bad real estate investing is buying houses subject to the existing mortgage. If you are thinking of real estate investing and area beginner stay away from subject to contracts. There is a better away of wholesaling real estate using creative financing then subject to real estate investing strategies. There are a lot of videos on subject to investing and how to buy houses subject to an existing mortgage, but real estate wholesaling and real estate investing with no money are normally a big scam! Before you buy a home subject to existing mortgage let me educate you on subject to real estate deals explained here is this video.

Learn how to buy a house in Florida from out of state with ease and avoid the pitfalls of buying property. Learn how to buy with little to no money down. These tutorials with educate you on how to buy or sell real estate with or without a realtor. When buying a house, should you first determine whether to look for Houses for Sale, Condos for Sale or Townhomes for Sale. With tens of thousands of homes listed in the MLS (Multiple Listing Service), learn how to find that right home for you. Learn how to educate yourself on what to buy, when to buy, where to buy, how to buy and why you are buying in the first place.

There are many people in Real Estate who have a license and just like any other field there are good ones and bad ones. Learn to ask the right questions when interviewing your Real Estate professional. Is he or she a Real Estate Agent or Broker? Understand the difference. Not all Real Estate professionals are realtors. Know whether your agent a realtor or not? Know what kind of questions to ask when buying real estate and know what kind of questions to ask when interviewing a real estate agent, after all, it is the most expensive investment you will make. Some Real Estate agents stay within a small geographical area and some service a broader area, and some specialize in Waterfront, oceanfront, country clubs, condos, townhomes, the list goes on. Find out which agent is right for you and careful how to choose a real estate agent.

Mike is a Southeast Florida Advisor with Premier Brokers International Real Estate. He loves the South Florida houses, townhouses and condos and helps his clients buy and sell real estate.

Call/text me if you are looking to buy / sell a home in the South Florida Area in Miami-Dade, the Greater Ft. Lauderdale, The Palm Beaches, Martin County or Saint Lucie County area! 561-207-8900

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[SuperMarioAIPro]

Hi Mike,

i appreciate you attempting to describe how to buy homes Subject To the existing mortgage.

The reality is that there are a handful of points that you have made or assumed that are not accurate.

First let's address your fundamental point which is, can the scenario that you described happen?

Yes. If a scammer does not provide the seller all of the safeguards that an investor buying Subject To normally does and takes over a home with no real business or investment intent/exit strategy.

However, a real investor or buy and hold buyer will provide the seller with a performance deed which kicks in 30 days after a late or non payment and most investors pay the seller and/or realtor a significant payment in order to acquire the property.

In most scenarios a sizable investment has been made and/or improvements to the property, coupled with the performance deed which would deed the property back to the seller without any need for them to foreclose on it, the investor would LOSE all of that money and the seller would gain all of that money.

Why would a real investor make a horrible investment and basically give the seller all of those funds and/or repairs for free?

You claim that this happens all of the time. Please provide all of your examples and I will provide you with Video testimonials of folks that are grateful for creative Subject To deals allowing them to get through challenging times in their lives paving the way for the next better chapter.

[terrorrealtv]

you spoke about scam, but the irony is the bank (the true scammers) will come and take your house and ruin your life anyways.

[Freshfromdirt]

Breaking news the realtor says the process of buying a house that doesn’t give him a cut is a scam …

[jamesyarborough]

I am sorry but I am an investor and buy subject to homes. I have never ever scammed one of my sellers. I typically have to invest a decent amount of money to get the home available for rent. I am currently having to pay $40, 500 dollars in order to take over the payments and with an investment like that, I definitely would not risk not paying the mortgage monthly. It would not be worth the time or money for the initial investment. This is a very negative viewpoint.

[scottyv]

As a professional realtor, I specialize in traditional home sales and offer creative options like "subject to the mortgage" transactions. These are tailored for homeowners in urgent need, providing them with some of their home's equity but also practical support. For example, I can arrange for them to remain in their home for an additional month to organize their affairs—a flexibility banks usually don't offer. Additionally, I ensure they have enough funds to cover moving expenses and living costs for the next two months. This approach not only meets their immediate financial needs but also alleviates the immense stress of having to vacate their home abruptly, without money or a place to go, which is a priceless benefit in itself. So always need to show both sides in a fair light.

[Mizkitty]

this seems spot on. The subject to seems to target desperate sellers. People are upset in the comments bc it will discourage sellers from being scammed.

[billyjean]

No, here's a typical subject to deal (I've done 46 over 20 years)
- agent can't sell house
- agent gets 2.5k
- owner gets 10k
- closing costs 2.5k
- fix up 5k
I've never defaulted and still have my sellers call me to hang out or ask for financial advice.

[teddyv]

Whoever subject to the owner's home did it wrong and it was just bad practice on his part.

[gabequezada]

Oh dear lord... This is just a hit- piece video against investors who actually help owners when no one else will.... Sorry Mike, I completely disagree with this presentation as it is riddled with inaccuracies..

[bricecay]

Sounds like a bad contract, or the Buyer had bad intentions from the beginning. It doesn't have to be predatory, and oftentimes is a way out for the seller as the other alternatives are usually selling at a loss or foreclosure. With subto, it allows the buyer to relive the seller of the financial burden while often times even putting cash in their pocket and with a good contract you defaulting on the mortgage would mean that the house reverts back to the seller making it not something you really have to worry about.

[AliciaCoxMedia]

Mike, I appreciate the concerns and they are real because if the investor doesn't make payments, the bank will call the loan due. However your explanation is not the whole story. Subject to is legal and good if done the right way. It is especially important to note that this technique is widely used on residential and commercial properties with much success for the seller.

[DAMON]

That doesn't make sense. Right off the top, the investor pays the owner's overdue payments in order to prevent the foreclosure with the bank. The new tenant pays the mortgage. So again, it doesn't make sense what you're saying.

[DudeInTheHoodie]

Lets kill the elephant in the room, Realtors don't like to see us making money because we didn't get a Realtors license. Let's address the loan being called due... LAND TRUST... we purchase in a Land Trust, solves the due on sale cause issue.

[GB-klpd]

I live in S FLA. and have done subject to's. I never "scammed" any of my sellers. A lot of time the sellers were negative equity, meaning in order to sell, they had to bring money to the closing table. In those cases, I would buy sub 2 because the homes were fairly new construction which means they required none to minor repairs. A win/win situation. BTW the homes were all sold, by myself using lease options.

[Chrischippi]

You’re 100% ignorant to some of the situations sellers actually go through and how this can be a solution for many people….

Yes there’s an inherent risk the seller takes but in many situations it is there best option rather than facing foreclosure or having to come up with money they don’t have to sell there house.

[AirbaIIs]

Every concern when doing subject-to existing loans are very accurate and not talked about to much. That said, as far as the banking side of things. The banks not making anymore money on a 2.7% vs a 8% interest rate. The banks collect a spread from their own borrowed dough

[KingDrew]

Why are all realtors jealous of the investors. What Mike isn't telling you guys is that this isn't something that's very common. Everyone can hear a horror story about something that happened in real estate but most people that are doing subject twos in some of these more complicated deals already have the experience and the liquidity to usually facilitate these complicated deals. The reason Mike views it as a scam is because he's a realtor and it's all about the sale. All they care about is the cut that they get at the end. But why haven't I seen Realtors help homeowners who have issues with their properties and get them out of those problems? What they like to do is create videos talking down on investors and allow their clients to go into foreclosures. Great job Mike

[BetterMilesAhead]

Never talked about a 3rd party servicing company and if you catch them up on there behind payments, that is in a way paying them. Plus if it was divorce and the buyer didn't make the payment the seller would be notified from the service company and after a certain amount of days of no payment the deed should be issued back to the seller, hopefully stated in the contract they both signed

[yonmoore]

Thanks for posting. There are certainly slime balls out there taking advantage of desperate people. Whoever bought that house should have educated the seller on the risks and the ways to mitigate those risks. Anyone who does a sleazy deal like that should be black listed in the industry.

[perryward]

Coming from a realtor you know that subject to deals work and it's done everyday. Most of the time thers no real estate agents involved, realtors don't like to see houses sold unless they are involved getting ther 6 percent .are you representing the seller and getting ther house sold or would you recommend they let ther house get go back to the bank? Subjecto is not a scam it's an option for a seller to sale his home and not give it back to the bank.lwhen a realtor has the property listed for 90 days or six months and can't sell the house then he needs to let his clients do whatever they can to sell the house to avoid foreclosure.