What is Subto? Subject to Real Estate Explained
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- čas přidán 20. 08. 2024
- How does Subto work? What is subject to in real estate? Can you get the property deed before you pay off the mortgage? In this training, we pull out the handy dandy whiteboard and break it all down for you…
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❎ I am not a CPA, attorney, insurance, contractor, lender, or financial advisor. The content in these videos shall not be construed as tax, legal, insurance, construction, engineering, health & safety, electrical, financial advice, or other and may be outdated or inaccurate; it is your responsibility to verify all information yourself. This is a CZcams video for entertainment purposes ONLY ❎
I swear pace, king of sub 2. Jerry Norton king of wholesalng. My these guys is a blessing to earth
made perrrrrrfect sense. omg. I want everything subto!!!!!!
I luv how detailed you are with both your students and non-students
Great job of explaining this bro🤙
I don’t fully understand but I will as I listen to you!!
Jose!!! My guy!!! We met at a Karaoke bar on the Day 1 of SubTo Mastermind on November 2022 and he noticed my SubTo hat and interviewed me. What’s up bro!! Chino here. Remember, Pace Jr 😂
I like how in a previous video he said he bought the house with $1700 to his name but somehow managed to give the seller $300k. Didn't mention that he still needed cash collateral to make something happen. Needs to mention that you're paying interest to someone to afford this.
In all of his subto deals he gets money from a private lender and his interest is usually low enough for him to make a reasonable profit
OPM Other People’s Money
thank you so much for such a great breakdown/analogies!
Thanks for the content, really useful. As a seller it would really bother me that someone else is paying a debt in my name. How do you overcome that objection? I get it these sellers are motivated. A video detailing that objection and the methods to overcome it is important.
I really like Subto; but, what if the seller says; i don't know you, how can i trust you to make the payments? They are still liable for the debt if you don't make payments.
@omaconstruction I believe that’s why you target the “desperate” seller who needs to sell or is tired of paying that extra mortgage. You also have to be a decent salesman to close the deal though
There’s terms in the agreement between seller and buyer to legally give the house back to the seller in the event of not being able to make payments
So then in a subto house purchase there is an agreement with that language to protect the seller in the event that the buyer doesn’t make
The payments?
Yes there is
There are terms, but if the buyer can’t make the payments, the seller gets everything back and keeps all the money that was made.
Got 2015 Honda accord with Seller finance with your method
No money down 🎉
Hey do you need to pay the amount of payment the seller previously paid upfront?
Love how he interacts with real people!
Thanks Mark!
yeah, definitely wasn't a scripted staged video
YOU ARE EXTREMELY GENIUS!!!! GOD BLESS YOU!!!❤️❤️❤️❤️💙💙💙💙
I had a car on turo but it was too much to take and drip off at the airport cuz I needed someone to bring me home. So always took two people to drop off.
So simply stated. Thank you!
I bought a house subject to, but I’m worried that I’m not on the insurance, and I don’t want to put myself on there because I’m concerned the lender will call the loan due. What should I do?
I would try negotiating with the lender. Banks typically don’t care as long as they’re getting paid on time. For future deals I’d personally reach out to the lender before even doing a deal just so this fear isn’t even present.
this is how u explain a subject. thank u
Glad you enjoyed it thanks for watching!
This was a great explanation video Pace. Thank you
Too many questions arise for me as to why would someone sale your car and you pay and we all friends and trust each other that payments is going to be made and who log in where. For house who name is on the inssurance? how do you what you need ot if you the owner but. . . my head is spinning!!!
how do you get your name on the title while you are making payments?
How do you have the title for the Kia if Ally is the lienholder?
Notice that you have no response. It because there is more than just that. So he is saying that he has the title to this car and he took over the payment of another person. He could just not make the payment. What does he care. The loan in in the name of someone else and he has the title. Come on.
What if you stop paying the loan after subject to? Does the debt fall on the original owner?
Great Question, great video also, but yes, left some things out. I think (i don't know) that in the subject to terms in real estate, there has to be a significant down payment to the Debt holder, and a contract that states that the buyer (not the debt holder) will get their own mortgage in a certain time period. one/two years etc. The Down payment has to be significant enough to recoup cost in the even the Buyer defaults.
What if you don't pay the debt and the previous owner's name is still on the debt?
One tool is a Performance Clause, Where by if i fail to make a payment as agreed, the deed is relinquished back to the seller in full, plus all payments made to date stay with the seller.
And how is that gonna help if now the seller is responsible for the payment on this old house he sold to the sub to guy ? Now he can’t afford the payment on his old house and new house he bought ? Now the seller is in a bind.
Perfect example for people who are sketched out by something they don’t understand.
How he transfer the title to he’s name my lawyer it’s telling me that’s can’t be done
Love the videos Pace keep it up
Wait a minute.. So you take over a loan of another person because they ended up not being able to make the payments.. But what happens if you end up not being able to not make the payments. Wouldn't that eff up their credit. The loan would still be in their name right.?
Thats what I thought bout too, how will the seller feel secure unless you are rich like him??
How do you get the title if the previous owner is financing?
Question, if the original buyer of the Kia was under executory contract then how would you get the title, through Bill of sale and title transfer? Leaving the old title held for security "useless"????
Exactly, his example with the car doesn’t make any sense.
The car is not the best example as you're not in possession of the title until the final payment is made, but I get it. Nice video.
Fair enough
@PaceMorby once the vehicle is paid off, how do you obtain the title? Do you have a limited POA document in place so you can go to the DMV and pick it up yourself?
How do you transfer the title if the title is being held by the Bank. If the new owner stops paying the loan how can the bank repo the car since new owner isnt obligated to the bank.
Last video you said you got your house for like 1700 now you put down 300 grand … ??? Which one is it
he could have borrowed the 300k..does it matter when he is illustrating the point of subject to?
Bitcoin is a good long term investment,
I need to start investing…
He is on telegramm
@k99coin
You can reach him on tel
Question @pacemorby How would you acquire the title in your example if you’re still paying off the car loan?
If there is a car loan the bank still holds the title?
How would you be able to get ahold of the title let alone put your name on it if the car loan has not yet been paid off and bank still holds title?
Ask this in the free Facebook paceapproves.com/freefb-ytc
Thank you so much Pace🙏
Bomb bomb BOMB Video! Thank you!
You are awesome, Pace!!!
You too!!
This is the way
Exelent explanation.
Where could I find the paperwork to get the contact made and sing?
How do you get people to trust you to login in to their loaners website though and pay in their name? I'm guessing you're making payment to the owner themselves and then they use that money to pay off the loan instead of you doing it direct yourself?
No you don’t pay to the owner directly, you pay to an escrow company who pays to the bank.
They handle the document aspect of the transaction. Good question though. Thanks
When you get the deeds in your name, can the loaner refinance on the loan?
Why would the seller be motivated as they will lose the money they have already put into the house? And what is the legal documents involved for the seller to feel comfortable with still owning the debt but someone else is paying for the debt?
The real name on the Title is still not “you” it’s the person who took the debt. Why do you keep saying the you own the Title when the banks holding on to it WITH the original buyers name.
When the loan to the “car” gets paid off the bank will send the Title to the the real owner who took on the debt no you.
Please explain or am I missing something?
Let me try to explain this to the best of my knowledge, pls don’t forget for a Subto deal to be carried out, document are signed…but is just that it is between you and the seller.
Like in real estate for example ( which I believe applies to all products like cars as well). A new deed or Title is raised that has your name on it. With a Title company, but the transaction between the bank and the seller ( house or car) remain btw seller and bank, which make their name remain as the borrower.
So you the new buyer, only have to pay the Title company, who pays the banks, ( as if the old owners or seller is still the one paying, until all debts are cleared.
Then I believe you will get a new note from the bank through the same Title company or escrow company showing you have successfully paid all outstanding loan.
I say this because, in subto deals, buyers has no business with the bank who loans a seller money.
That is why in a situation where one person default, the escrow company has a document that says, the buyers forfeits all payment till dates..which in that situation will be in benefit of the seller..who you have helped pays his loan for let’s say 6 months.
I hope this made some sense.
Kindly Check more videos ..Subto is so interesting..just Analyzing the process. Thanks
@@apostlemarvinomede3961 interesting. Top Tier Investing right there.
@@apostlemarvinomede3961 Used to do indirect car lending and had the same question. This clears it up very succinctly. Thank you.
🤯❤ that's amazing... so how do I doing these deals then?
@@apostlemarvinomede3961, perfectly said..hence, the assignment name of "Subject To"!!
How do you change the title to your name if there is a lien on it
If you head over to my Facebook Group - paceapproves.com/communityfbc and ask this same question, I bet you'll get a lot of feedback. We have over 80k+ people in that group and my Mastermind Subto Students who I mentor are in there helping out. Join us!
Can the seller go to the mortgage company and get another loan on their current mortgage (HELOC, etc.) now you are left paying more because they withdrew more money
I just found a foreclosure online that can be a subto but the auction date is Tuesday.
Nice!! Where did you get the lead from? Batch leads ? PropStream?
I still have a questions, tho. In the car subto.
No matter how good of a breakdown you give, I still can't find one video that talks about how to actually put the money into your pocket? Sure, I'll get a seller to agree for subto but say I find a renter to get in there with a cashflow of 500, does the tenant pay me my money and then I pay the seller with that money? How does the transaction work?
_Sure, I'll get a seller to agree for subto but say I find a renter to get in there with a cashflow of 500, does the tenant pay me my money and then I pay the seller with that money?_
Yes. For example, if the payment on the mortgage is $400 a month, and you rent out the property for $1400 a month, the renter pays you $1400, and your third-party mortgage servicing company automatically debits $400 of that from your business bank account to pay the mortgage for you. Leaving you with $1000 a month in cashflow that stays in your business bank account.
@@jalabi99 thanks for clarifying.
I'm still confused, how is sub2 any different from assuming a mortgage?
Explicitly assumable mortgages are hard to find , and the clauses in most mortgages I've seen disallow assuming payments!
Also , aren't there some legal caviots not superceded by contract law in some states? What are they?
To assume a mortgage you have to qualify for the loan.
I have a playlist called Due On Sale that covers the clauses in mortgages disallowing subject to.
I'ma need you to know what Turo is kid... lol
So the 3mil was the purchase agreement and the 300k down payment was the difference of purchase price & debt owed?
Hello Pace Morby, I thought you made an appointment today 5/4/23 from 8:00 - 8:45 ? Is that correct?
I need to find a primary residence sub to
Are you ever going do any seminars in South Texas ?
Here's what I got scheduled this year so far bro: whereispace.com/
@PaceMorby thanks, just a little out of reach but I'll definitely keep watching the vids. A friend of mine recommended your CZcams cgannel on creative financing. Thanks again.
Do I subto a parcel of land the same way I would with a house?
Hey my parents are selling their home. If I can get them $60-75,000 I could do this with their home. How and where would I get that type of financing? It’s a 5 bedroom and want to rent it out
Fire!! 🔥🔥🔥
No bank will release a deed or title without full payment..
The bank doesn't hold the deed so that's fine.
For Sub to, who do you send the payment to the seller or to the lender?
Lender
I see the flaw that 300k you paid to take over the debt, where’d you get that from?
I'm an insurance agaent and investor how to i get more involved?
So you don't actually own anything. So how do you build equity? You can build equity with owning a deed or title. But the debt is still in the other person's name? How is that legal
czcams.com/video/dp3pITjnUlk/video.html
Also, i'm not sure how this works in the US but, here in, canada if you bought a car and are making payments on it, if the car is registered and insured in my name, i am the legal owner of the car; no matter who is making the payments. So, once the deed is legally transferred to your name, you legally own the house. Forget equity for now; equity just means value.... The value of the house doesn't change based on who owns it.... When you sell, whenever you do, you will receive the equitable value in profit. You are concerned about equity as it relates to the banks.
they did a bill of sale for the car so it would be in pace's name and insurable, right?
If the mortgage is still in the seller's name, then their DTI is still impacted by the mortgage isn't it? They can't go and buy another property if their DTI is maxed out.
Yes
So is the insurance on a subto car still in the original owner name?
Check out my SubTo Cadillac video, we talk about it there czcams.com/video/o3cjfzx5Ykk/video.htmlsi=YL4BoarJadi_vqpC
Does this strategy impact the sellers ability to get a loan on their next house?
Yes
I live in California where people are Leaving the state because of taxes and inflation and what not, is it a good place to try sub 2?
I don't buy in California for those reasons and more.
Question: I'm curious to know where/how did you find the owner of the Kia Pace?
Yes I’m wondering this also
There's plenty of places: Craigslist, Facebook Marketplace, OfferUp, LeaseTrader, ...
So with this Kia are you able to get your name on the title before the loan is paid in full?
If you head over my Facebook Group - paceapproves.com/communityfbc and ask this same question, I bet you'll get a lot of feedback. We have over 80k+ people in that group and my Mastermind Subto Students who I mentors are in there helping out. Join us!
@@PaceMorby will do!
@@PaceMorby I appreciate it
what after year 1, you crash the car and it is worth nothing .....what after a fire the house worth nothing ....???
Um, insurance??
Smh
Ommits politely say you are scaming your sub to training clients because it is illegal or not possible to get the title in your name subto. You never own the asset and the original debt holdrr is on the hook & he would be a fool to give his keys to you for a promise that he can not enforce. Every unethical person in the world woud be looking for a deal like this to get a free car until the bank repo it, but maybe he cashes in by taking the car to the chop shop! In any case the original owner that was dumb enough to give you the keys still owes for the car. So instead of it being that the bank can repo u o wipe the remaining debt -- now without the repo the poor smuck that gave you his keys owes 3 times as much to the bank. He would have been better off to let the bank repo it !!
I read somewhere that there's a relinquish clause ,that if he stops paying then deed goes to original buyer and he keeps the money that has been paid until then
Ok but whether bank owns the car or is just holding the title, I still can’t register the car until the lien is paid, at least in Canada. @PaceMorby