Buying property – “due on sale” bank clause

[christopheranderson]

Someone told me that I could buy a property “subject to” the existing loan. That the seller could just deed the property to me and I could take over the payments. Is this legal and what will the bank do when they find out? What about the “due on sale” clause? Can anyone help me on this. It sounds like an incredible way to buy property, but I don’t particularly want to go to jail.

[rmurray]

Jail is NOT the consequence... Losing the land and your investment in a civil action could be the worse that happens...If the bank has a due on sale clause they can and probably declare the loan immediately due in full.Then you would have to pay them or lose it all, often the bank offers you the chance to refi the property in your name if you qualify..These kinds of sales are not that unusual..They can be very safe if you involve a good local real estate attorney who does a title search and gives you an opinion about the deed history and the sellers interest..Do NOT cut corners and skip this step..The seller might very well have other liens, judgments or taxes attached to the property..Protect yourself and go for it..