Why routing a subject to payment through the seller turns into a 45 day late.

Short version for anyone about to do their first one. Subject to means the loan stays in the seller's name and the buyer takes over the payments. The lazy setup, and it is common on a first deal, looks like this: the buyer sends the seller $1,275 on the 1st by bank transfer, and the seller pays the mortgage from her own account, because the autopay is already set up and she says it is easier. Month four the seller has a car repair. The $1,275 goes to the shop. She does not mention it. The buyer finds out when the servicer's late notice goes to her old address, which is now the buyer's rental, and the tenant texts over a photo of it. By then it is 45 days past due. Cost: $86 in late fees, a 30 day late on the seller's credit, which is the one thing she asked the buyer to protect, and a very bad phone call. The loan does not get called in this case. It could have been. A late payment is the fastest way to get a servicer looking at a file, and looking at the file is how the due on sale clause stops being theoretical. The fix is a third party loan servicer. The buyer pays the servicer, the servicer pays the lender, and a statement shows it happened. Around $32 a month, and worth five times that. What to do differently: never route a payment through the seller, whatever the reason and however convenient the existing autopay looks.