Subject To Definition and Legal Meaning

On this page, you'll find the legal definition and meaning of Subject To, written in plain English, along with examples of how it is used.

What is Subject To?

(adj).When a property without clear title or encumbrance is transferred to a person, with his knowledge and consent about the liabilities attached to the property such acquisition of the property is called an acquisition subject to the liabilities attached to the property. It may also require the consent of the lender. The lien or mortgage right owned by the lender is not effected by such transfer as far as the property is concerned

History and Meaning of Subject To

"Subject to" is an adjective legal term that mainly deals with property transfers - when a property is being transferred to a new owner, but the property has some underlying liabilities or encumbrances that will still exist after the transfer. The buyer takes the title "subject to" the existing encumbrances, which means if there are any issues with the property, the buyer will be responsible for them rather than the seller.

Examples of Subject To

Here are some examples of the use of the term in different situations:

  • John is buying a house with a mortgage, but he can't make the mortgage payments. He finds a buyer willing to take over the property "subject to" the existing mortgage, so John transfers the property to the new buyer, who now becomes responsible for making the mortgage payments.
  • Mary wants to sell her rental property, but she still owes money on the mortgage. She finds a buyer who is willing to take over the mortgage payments and buy the property "subject to" the existing mortgage. Mary transfers the property to the new buyer, who now becomes responsible for making the mortgage payments.
  • Jack has a car that he's still making payments on, but he wants to sell it to Jill. Jack transfers the car "subject to" the existing loan, so Jill becomes responsible for making the remaining car payments.

Legal Terms Similar to Subject To

Here are some related legal terms with explanatory definitions:

  • Lien: A legal claim or hold on property as security for a debt or charge.
  • Encumbrance: An interest or right to something, especially someone else's property, that restricts or impairs the property's transfer or use, such as a mortgage, easement, or lease.
  • Mortgage: A legal agreement in which a person borrows money or secures a loan with property or real estate that serves as collateral.