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How to Property Service Subto Deals | The Kevin Choe Show Ep. 3
Manage episode 487651102 series 3670519
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In this podcast, I discuss sub two insurance and sub two servicing with my transaction coordinator, Love. We provide insights and recommendations based on our experience with subto deals. We emphasize the importance of hiring a third-party servicing company to ensure timely mortgage payments and discuss the factors to consider when choosing a servicing company. We also address common concerns about the due-on-sale clause and explain how insurance plays a role in mitigating risks. I recommend working with insurance agents who understand creative finance and provide guidance on setting up the right insurance policy.Takeaways:-Hiring a third-party servicing company is crucial for ensuring timely mortgage payments in subto deals.-When choosing a servicing company, consider their requirements, flexibility, and ability to cater to different types of transactions.-The due-on-sale clause is a common concern in sub two deals, but it is rarely enforced. Insurance plays a role in mitigating the risks associated with the due-on-sale clause.-Working with insurance agents who understand creative finance is important for setting up the right insurance policy.-It is recommended to get a new insurance policy and replace the seller as the primary insured, while adding the seller as an additional interest.
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