Understanding “Subject-To” Real Estate Transactions in Texas

When life throws financial or housing challenges your way, sometimes the traditional way of selling a house just doesn’t work. That’s where a Subject-To transaction — often called “Sub-To” — can step in as a creative solution.

What Is a Subject-To (Sub-To)?

A Subject-To is a type of real estate transaction where you, the homeowner, transfer the deed (ownership) of your property to us, while the existing mortgage loan remains in your name — with us taking over the responsibility for the property and making the payments.

That means:

  • You no longer own or manage the house.
  • We take over the responsibility for making your monthly mortgage payments.
  • Your loan stays in place in your name, but you’re relieved of the stress, costs, and responsibilities of the property.

Who Is Sub-To Best Suited For?

This option isn’t right for everyone. It tends to work best for homeowners who:

  • Have low or no equity in their home (meaning selling with a realtor may leave you owing money at closing).
  • Tried to list with a realtor but had no luck because of retail buyer demands and market conditions.
  • Are behind on payments and facing the possibility of foreclosure or an auction.
  • Need a fast, no-nonsense exit without extra expenses or obligations

Benefits of Selling Your House Subject-To

Choosing this route can save you significant time, money, and stress:

  • No out-of-pocket closing costs.
  • No realtor fees or commissions.
  • No concessions like covering buyer costs, no costly repairs, or inspection headaches. We buy “as-is”.
  • Fast closings — avoid the delays of listing, showings, and buyer financing.
  • Avoid foreclosure and auction. A Sub-To may stop the process and protect your credit from a major hit.

Potential Risks You Should Know

We believe in transparency, so it’s important to also understand the risks.

  • The loan remains in your name, even though you no longer own the property.
  • If an investor (the buyer) were to default on payments, the lender could still take steps to foreclose on the property.
  • In our process, if that happened, we would deed the property back to you so you could regain ownership and take back control.
  • In extreme cases, you may need to pursue legal avenues to enforce your rights and protect your credit.

We structure every transaction carefully to reduce these risks, but we want you to be fully informed before moving forward. See the disclosure below.

Why Investors Like Subject-To

While the main benefit of a Subject-To deal is for you as the seller, there are also reasons why investors prefer this type of transaction. These reasons often translate into positive community impact:

1. Your loan already has a good interest rate
If your loan carries a lower interest rate than today’s market, we can keep costs manageable — savings that can be passed on to future buyers or renters.

2. We can bypass the red tape and delays of new bank loans
Without needing new financing, we can close faster and step in when you need a quick solution.

3. Helps create new homeowners
We can resell through creative financing (like owner financing) to families who don’t qualify for traditional mortgages — opening the door to homeownership.

4. Supports affordable housing solutions
We can repurpose homes into shared housing or co-living spaces:

5. Provides more housing for renters
Some people just need a safe, desirable place to rent. Subject-To deals allow us to offer homes to families, individuals, or students — often at better rates than big corporate landlords.

6. Keeps good loans in play
Instead of letting a mortgage get wiped out in foreclosure, we can step in and keep payments current — protecting the lender, stabilizing the neighborhood, and helping safeguard your credit.

7. Speeds up our ability to help
Since we don’t need to apply for new loans, we can act quickly — a major benefit when foreclosure is near.

FAQ – Common Seller Questions About Subject-To

Q: What happens if you don’t make the payments?
A: If for any reason payments weren’t made, the lender could foreclose since the loan remains in your name. With our process, we’ve built in protections — including a deed-back option — so the property can be returned to you. You’re never left without recourse.

Q: Will the loan show on my credit report?
A: Yes. Because the mortgage stays in your name, it continues reporting to your credit. The positive side is that consistent, on-time payments we make can actually help keep your credit steady. We’ll walk you through how this works so you always know what to expect.

Q: Do I still have to pay for repairs or upkeep?
A: No. Once the deed transfers to us, we take over all property responsibilities — maintenance, repairs, insurance, and ongoing costs. You walk away without that burden.

Q: Can I buy another home if my loan is still in my name?
A: Every situation is different. Some lenders may still count your existing mortgage against you, while others are more flexible if you can show proof that payments are being made. With a dedicated Mortgage Lender partnered directly with our team, we’re highly experienced in handling this scenario and can even coordinate with your new lender to smooth the process.

Q: Will I be able to claim the property for IRS tax purposes?
A: No. Once you transfer the deed, you’re no longer the owner of record and typically cannot claim property-related tax deductions such as mortgage interest or property taxes. We always recommend consulting a licensed tax professional for advice on your unique situation.

Q: Why wouldn’t I just let the bank foreclose?
A: Foreclosure is damaging in the long term — it stays on your record for years, impacts your credit, and makes it much harder to buy or even rent another home. A Subject-To transaction allows you to avoid that outcome, preserve your credit, and get on with life without the heavy financial baggage.

Final Thoughts

With Love Investors and our Partners, our mission is to create solutions when traditional selling routes fail or aren’t an option. A Subject-To transaction could be the right fit — even a life-changing solution — for homeowners who need to stop foreclosure, avoid out-of-pocket costs, and move forward with peace of mind.

We’re here to walk you through every step so you feel supported and informed.

Important Disclosure

This information is provided by Love Investors for educational and informational purposes only. It is not legal, tax, or financial advice. Every homeowner’s situation is unique, and we strongly encourage you to seek independent legal counsel and/or professional financial guidance before entering into a Subject-To (Sub-To) agreement or any real estate transaction.

While we aim for transparency and care, we make no guarantees or warranties regarding outcomes. By considering a Subject-To transaction, you acknowledge that you have been advised to consult with an attorney or other qualified professional to fully understand your rights, obligations, and potential risks.