Is Mortgage Takeover (Subject-To) right for you?
It usually fits when:
- You owe close to what the house is worth
- Your mortgage is current, and a regular sale wouldn't cover commission and closing costs
- You have a low interest-rate mortgage and need to move
- You understand the loan will stay in your name and on your credit
How it works
- Review your loan. We look at your mortgage statement, payoff, arrears, taxes, and insurance.
- Written agreement. You get a plain-English agreement covering who pays what, when, and what happens if anything goes wrong.
- Confirm the loan status. We verify the loan is current and the escrow for taxes and insurance is in order.
- Close with a settlement attorney. The deed transfers through a Delaware settlement attorney. Insurance is updated to protect you.
- Payments tracked. An independent loan servicer makes the monthly payment, and you can verify it at any time.
Pros and cons
Upside
- ✅ Can work when a traditional sale wouldn't cover costs
- ✅ No commission; quick to close
- ✅ Payments tracked by an independent servicer you can check
Trade-offs
- ⚠️ The mortgage stays in your name until paid off or refinanced
- ⚠️ Lenders can enforce the due-on-sale clause and call the loan
- ⚠️ Your credit depends on the buyer making payments
What the numbers can look like
Illustrative: You owe $240,000 on a house worth $255,000 and your payments are current. Listing would cost about $20,000 or more in commission and closing costs, more than your equity. In a subject-to, we take over the monthly payment through a servicer, and the loan stays in your name until it's paid off or refinanced.
How you're protected
- Third-party loan servicing so you can verify every payment
- If payments stop, your remedies are set out in the written agreement your attorney reviews
- Hazard insurance naming you as an additional insured
- Payment reserves held for the loan
- Encouragement to use your own attorney or a HUD-approved housing counselor before signing
Not sure which option fits?
Tell us about the house. We'll lay out every option that works, side by side, with the numbers.
Get My Written Offer Call (302) 798-8655Frequently asked questions
Is subject-to legal?
Yes. Transferring a deed while the existing loan stays in place is legal. Most mortgages have a due-on-sale clause that lets the lender demand full payment after a transfer. That's a contract right the lender can choose to use, not a crime, and it's why we disclose it up front and keep reserves.
Will this hurt my credit?
The loan stays on your credit report. On-time payments (which you can verify through the servicer) help it. A missed payment would hurt it, which is why the agreement includes performance protections.
What if the lender calls the loan?
We'd need to pay it off or refinance. Our agreement commits us to that and describes what happens if we can't.
I'm behind on payments or in foreclosure. Can we still do this?
If your mortgage is 60 or more days behind, or a foreclosure has been filed, Delaware's Mortgage Rescue Fraud Protection Act (6 Del. C. Chapter 24B) may restrict or prohibit this kind of deal. Talk to an attorney or a HUD-approved housing counselor (800-569-4287) first, and call Delaware's free mediation program at (800) 220-5424.
Can I get my house back later?
Not as part of a standard subject-to. Buy-back promises to homeowners in default are heavily regulated in Delaware. If staying in the home is your goal, start with a loan modification through the free mediation program.
Do I get any money?
Sometimes a modest amount, depending on your equity. Keep in mind the loan stays in your name and on your credit until it's paid off or refinanced.
General information, not legal, tax, or financial advice. Examples are illustrations, not offers. Consult your own attorney and tax advisor before selling.