14 Options to prevent foreclosure
Subject To Seller Financing
Sell the home to a buyer who takes over the existing loan "subject to" the mortgage, without refinancing.
Let a Buyer Take Over the Mortgage Payments and Save the Home from Foreclosure
What Is a “Subject-To” or Seller Financing Deal?
A Subject-To deal (short for “subject to the existing mortgage”) allows you to transfer ownership of your home to a buyer, who then takes over the existing mortgage payments—without paying off or refinancing the loan.
In seller financing, you act like the bank: you sell the home and carry the loan for the buyer, often with customized terms. Both strategies are creative ways to stop foreclosure, especially if traditional sales or loan modifications aren’t possible.
Who Should Consider Subject-To or Seller Financing?
This option is ideal for:
- Homeowners who can’t afford the mortgage but don’t want foreclosure
- Those with little equity, making a traditional sale difficult
- Sellers with buyers who are willing to take over the loan
- People who’ve been denied for loan modification or refinance
- Homeowners who need a fast solution and flexible exit strategy
How It Works: Step-by-Step
- You find a buyer or investor willing to take over your mortgage.
- The buyer agrees to start making your monthly mortgage payments.
- You sign a purchase agreement, and the buyer gets the deed.
- The loan stays in your name, but the buyer takes over property management.
- The buyer may refinance later, or sell the home, paying off the loan.
Benefits of Subject-To / Seller Financing
- Stops foreclosure immediately by resuming payments
- No credit or income required from seller
- Useful when a traditional sale or refinance isn’t possible
- Allows buyer to fix or improve the home
- Seller may receive an upfront payment or monthly income
- Flexible, creative solution for unique situations
Considerations & Risks
- The mortgage stays in your name until buyer refinances
- Due-on-sale clause could trigger lender action (though rarely enforced if payments are current)
- Must use professional contracts, disclosures, and title protections
- Seller is still legally responsible if buyer fails to pay
What You’ll Need to Apply
- Mortgage statement and loan terms
- Buyer or investor with agreement to take over
- Signed purchase agreement
- Deed transfer via escrow/title
- Promissory note and agreement terms (for seller financing)
Timeline
- Buyer agreement: 1–3 days
- Paperwork and deed transfer: 3–10 days
- Mortgage must be brought current or resumed immediately to avoid auction
Real Example
Eric was behind 4 months on his mortgage and couldn’t sell due to zero equity. A local investor agreed to take over the loan “subject-to.” Eric avoided foreclosure, moved out, and the investor rented the property. The mortgage stayed current, and Eric’s credit recovered over time.
Frequently Asked Questions
Q: Is this legal?
🅰️ Yes—if done properly through escrow and disclosure. Subject-to and seller finance deals are 100% legal but must be structured with professional help.
Q: What if the buyer stops paying?
🅰️ You’re still legally on the loan. Always use a contract with default protections, and only work with trusted buyers or investors.
Q: Will this hurt my credit?
🅰️ Not if the buyer keeps the payments current. It can actually help your score recover by keeping the loan active and in good standing.
Want to Explore a Subject-To Exit?
We work with vetted real estate investors and buyers who specialize in helping homeowners in foreclosure.
- Connect with local buyers who can take over payments
- Structure legal contracts and protections
- Ensure smooth transition and avoid foreclosure
- Help you move out with minimal stress