No Credit Required Options - The” Subject To” Technique

If you still can’t qualify for a loan, or would just prefer not to, here is one of the basic methods for buying a house with no credit check required. This is one of several popular methods for buying with no credit check, and is used by home buyers and sellers everyday. For more ideas on how to buy a house when you can't get a loan, check out our website at http://I-can-buy.com.


There is an investor technique out there called “subject to” or “sub 2.” In this technique the investor will find an owner who is totally distressed and ready to lose the property, but it has not gone into foreclosure just yet. At this point the investor involved makes up the back payments, takes over the regular payments for the seller, and gets the deed to the property. The loan stays under the old owner’s name. The investor gets the property and can do whatever they want with it-- rent, lease-option, or sell it.

The name comes from the contracts they sign (a “subject to” purchase agreement) that says the buyer gets possession of the home and will be making future mortgage payments.

This may be great for the investor, but the loan liability stays with the seller until the house is sold and although it is not strictly illegal, it is a breach of contract because it leaves the bank or mortgage loan holder in the dark. Most loans have a “due on sale” clause, so the bank can call a loan due when ownership of the home changes. That means that investors who do this kind of “assumption” take the risk that the bank will find out, and ask for all the loan money right then and there. If the buyer does not have the money, the house will go into foreclosure. This may not be likely if the payments are made, but it is risky and according to many, not ethical.



This has been an excerpt of the book by Alex Dey called Buying a Home When You Have Bad Credit. This is a free ebook that can be found on our site at http://I-Can-Buy.com.


Buying a Home When You Have Bad Credit is written by Alexis Dey, Copyright © 2005-2006 Mohave Publishing. All rights reserved. This book is protected by international copyright law. You may not otherwise resell, reproduce, distribute, publicly perform, publicly display, or create derivative works of this material, unless authorized by Mohave Publishing.