Subject-To Deal Calculator
Analyze a Subject-To (Sub-To) real estate deal — you take title and pay the seller's existing mortgage. Lower acquisition cost than traditional financing, but the loan stays in seller's name with due-on-sale risk.
What Is a Subject-To Deal?
Subject-To (or Sub-To) means buying property subject to the existing mortgage. The loan stays in the seller's name; you take title and make payments. Common with motivated sellers (divorce, relocation, low equity) who can't sell traditionally. You skip new loan qualification but inherit the loan terms — interest rate, balance, term.
The Due-on-Sale Risk
Almost every conventional mortgage has a due-on-sale clause: lender can call the loan due if title transfers. In practice, lenders rarely call performing loans (you keep paying on time). But the risk is real — major rate shifts, lender audits, insurance changes can trigger discovery. Always have an exit strategy: cash refinance reserves, hard-money backstop, or willing private lender.
When Sub-To Beats Traditional Financing
Sub-To wins when: (1) existing rate is well below market (2024-2025 deals had 3-4% loans vs 7% market), (2) seller has zero equity or negative equity, (3) seller needs quick relief from payments, (4) you lack down payment or credit for conventional financing. The math: low-rate inherited loan = $500-1500/month savings vs new loan on same balance.
Documentation You Need
(1) Recorded warranty deed transferring title. (2) Authorization to communicate with lender. (3) Mortgage payoff statement at closing. (4) Insurance policy in your name (with named additional insured for lender). (5) Land trust or LLC for asset protection. (6) Sub-To-specific purchase contract clauses. Don't attempt without an experienced real estate attorney in your state.
Sources: BiggerPockets Sub-To community, NAR investor profile 2024. Last updated: May 2026.
Frequently Asked Questions
What is a Subject-To deal?
Buying property 'subject to' the existing mortgage. Loan stays in seller's name; you take title and make payments. Used with motivated sellers when traditional financing is impractical.
Is Sub-To legal?
Yes in most US states with proper documentation. The due-on-sale clause is a contractual remedy lenders rarely enforce on performing loans. Always work with a real estate attorney.
What about the due-on-sale clause?
Lenders can call the loan due on transfer of title, but rarely do on performing loans. Mitigate risk by keeping payments current, maintaining insurance, and having refinance reserves ready.
How is Sub-To different from a wraparound mortgage?
Sub-To: you pay seller's loan directly. Wraparound: seller-carried second loan wraps around the first. Wraps have more legal complexity and require seller cooperation longer.
Is this tool free?
Yes. 100% free, no sign-up. All math runs in your browser \u2014 your deal numbers never leave your device.