Is Sub-To Investing Dead?
I have been reading and posting here for a while. Cash got me started doing sub-to and I have not looked back. Sub-to is a great tool. However I have noticed that the board has shifted. Sub-to is not hot any more. Why? Is it fear od DOS, higher rates, or that everyone thinks there is a bubble that is or has popped? Are there new laws to worry about or is it that all of the great posters have retired and moved on? Just wondering......
J
Hi James,
Sub-To investing isn’t dead at all.
What you are experiencing is a cycle not only for all actual real estate investing but also in postings on the REI boards.
People come and people go on this board just like everywhere else.
And Sub-to is just another tool in that infamous “tool box” to be used when and where appropriate just like any other investment strategy.
Through the years though; and I have seen this on other boards, where a lot of the big named knowledgeable and experienced posters left because of the misinformation given by new people with their own agenda.
Plus the fact it really gets old answering the same questions over and over again because that new person won’t use a search function to check to see if his question has been answered before.
No Sub-to is not dead…just going through a cycle right now.
Hope this helps
John (LV)
I just did one this past month.
In reference to the board cycle.
Exhibit A: Look above my post.
John,
A land trust is not a real estate resale transaction and does not apply.
Wiz
not a lawyer
[addsig]
Quote:
On 2006-07-13 21:48, mtnwizard wrote:
John,
A land trust is not a real estate resale transaction and does not apply.
Wiz
not a lawyer
It makes no difference whether a land trust is a real estate transaction or not.
What applies here is exemption #3 where it states "Beneficial Interest" and how North Carolina interprets it.
John (LV)[ Edited by jfmlv1950 on Date 07/13/2006 ]
Yes I am of the opinion that even though Land Trusts may be legal to use by Federal Law, how they are used will be determined by each state.
And the way I see it these new laws will curtail the use of Land Trusts just like not using them.
We will all find out what will happen in NC if and when this bill is passed.
John (LV)
I think the courts (NC and Fed) will have to sort this out if it becomes law. Fed always trumps state law. I am no lawyer but from what I readed if you are not the person on the mortgage you can not take any money for down or option. Again good luck to all NC investors.
James,
This Article shall not apply to the following:
(1) Any real estate resale transaction exempted from the preemption provisions of the due on sale clause prohibitions pursuant to 12 U.S.C. § 1701j‑3(d). (LAND TRUSTS)
Wiz
not al awyer
[addsig]
charlotte,
You have it right with one exception. Even with a land trust you may not sell with an OPTION to buy. That would violate the DOSC. What we do is sell at the end of the lease at Fair Market Value with our Tenant/Beneficiary having First Right of Refusal.
Wiz
not a lawyer
[addsig]
I completely disagree with John. States will have nothing to do with how land trusts continue to operate. Remember they have been used by the wealthy since 1891 and Federal Law ALWAYS supersedes state law. In North Carolina, land trusts continue to be legal and are clearly exempted from the law by the very wording of the law (HB725) itself. "This Article shall not apply to the following":
(1) Any real estate resale transaction exempted from the preemption provisions of the due on sale clause prohibitions pursuant to 12 U.S.C. § 1701j‑3(d).
You seem to forget that land trusts are PERSONAL PROPERTY and are subject to the laws of the UCC, NOT mortgage law. That is why we should have a separate thread for Land Trusts. Lease options, land contracts, wraps, equity sharing, contracts for deed are all methods of investing that are subject to and crippled by real estate law.
We get accused of "board hustling" if we show how a land trust can be used to achieve the goals of ALL of these methods of investing FREE from the restrictions and road bumps such as the DOSC, disguised sales, and equitable interest.
There is NO WAY our legislators or banks are going to do anything to interfere with the land trust. Their members and wealthies depositors use them and rely upon them for privacy and asset protection.
Wiz
not a lawyer
_________________
"He not busy being born is busy dying" - Bob Dylan
[ Edited by mtnwizard on Date 07/16/2006 ]
I agree with Da Wiz.
Wiz,
It is obvious that you are trying to hi-jack this post as you have repeatedly done here on TCI and other boards, with your same old spin.
You quote exemption #1, yet fail to quote exemption #3 just below it which puts on limits.
I will agree with James and wait for the legislature to figure it out instead of trying to second guess what might happen or not. I’ll wait for the facts to come out if and when this bill gets passed.
There is way too much time wasted going back and forth on “what ifs” that may never become true.
John (LV)
hijacking...come on...lets get real. Land trust investors use subject-to as much if not more than regular investors using the addition of Land Trusts...they just feel safer doing it this way. When subject-to is brought up they have every right in the world to express their experiences in their world of subject-to...unless of course the poster specifically exempts the land trust and specifies subject-to without land trusts...regards, CWal.....p.s. THERE DOES NEED TO BE A LAND TRUST FORUM...
cwal,
You miss my point entirely.
It has nothing to do with using land trusts or not using them.
Is there a place and use for land trusts? Of course there is.
My point has to do with the Wiz saying the same thing over and over and over again and not putting out the complete truth along with saying anything new and productive.
If you are going to quote exemptions to a bill that hasn’t even been passed yet, then don’t just quote the one that makes you look good. I already have shown he was incorrect in stating that only Realtors will be able to do Subject To deals (exemption #2). It also looks like the legislature in NC saw this transfer of beneficial interest of a property within a trust coming and added language to this bill to stop or limit it (exemption #3).
States can and will regulate how business will be conducted within their borders. If (and now we go into the “what if” scenarios) North Carolina wishes to limit the number of properties transferred into a land trust, they may do so whether they be considered real or personal property.
Of course, all this back and forth is speculation on everyone’s part because the bill hasn’t passed yet.
John (LV)
[ Edited by jfmlv1950 on Date 07/16/2006 ]
Wiz,
You are correct the topic is "Is subject to financing dead?" so why are you bringing up anything about land trusts when the correct answer is what my original response stated?
John (LV)
As the original poster I was worried when the subject of land trust came up. I feel that land trust is a way to hold property but is not a tool for investing. Short Sale, sub-to etc are. Now I may be wrong but this latest back n forth shows that to many people are set in their ways and are willing to play the what if game. I read the bill and in my untrained eye it says no land-trust. But it is not a law yet. Lets deal with cold hard facts. People are getting themselves into upside down loans, some areas are not seeing the growth in prices, people are being foreclosed on, tenent-buyers are not paying these are all real problems. How do we help people like this and make a profit and keep our souls? Please stop with the its better because I say its better stuff..... So is sub-to dead?????
I have to agree with John .. and another reason to get a Land Trust Forum.
Come on Wiz - fellow Arizonan - let up ... every post I read - you put the "land trust" thing in there.
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