Squatters Set the Garage on Fire During Our Deal. We Closed Anyway.
Squatters moved into the property while we were under contract.
Then they set the garage on fire.
We closed two weeks later.
By Zareena Samidon | Samidon Realty Group | Colleyville, TX
The Situation
A husband and wife in Dallas had separated. The wife had already moved out. The husband was living in the house with their teenage son but could not afford the property on a single income — the mortgage was sized for two.
He called us.
Foreclosure-related calls to our DFW office have tripled in the past 12 months. The national data confirms the trend: ATTOM's Year-End 2025 Foreclosure Market Report showed foreclosure filings rising 14% in 2025, with eleven consecutive months of year-over-year increases extending into 2026. Texas led all states in completed foreclosures (bank repossessions) in January 2026 with 573 REOs, and Dallas ranked fourth among major metros nationally with 122 REOs that month. [Source: ATTOM Year-End 2025 Foreclosure Market Report; ATTOM January 2026 U.S. Foreclosure Report] The financial pressure driving those numbers is the same pressure that drove this husband to call us.
The Property
This was a house in an ideal location in Dallas — a neighborhood where buyers want to be.
The interior was severely infested with roaches. This was not a minor pest issue. It was a deep infestation requiring professional remediation multiple times before the house could be shown.
The condition affected every number in the deal.
Why a Cash Offer Didn't Work Here
We could not reach a cash purchase price that worked for everyone. The infestation, remediation costs, and renovation required brought our offer below what the sellers needed.
This is where many investors stop. We asked a different question: what does this family actually need?
The answer was in the mortgage.
The husband and wife had an existing fixed rate of 3.5%. As of May 2026, the average 30-year fixed mortgage rate is 6.56% — its highest point since August 2025. [Source: Bankrate.com, May 29, 2026; NerdWallet current rate data, May 29, 2026] A 3.5% mortgage in this environment is not just a loan — it is a transferable financial asset. A buyer who acquires the property subject-to that rate acquires financing that would cost nearly double to replicate from a lender today.
The 305 basis-point spread between the existing rate and the current market rate is what made a subject-to financially compelling where a cash purchase was not.
The Subject-To Agreement
In a subject-to transaction, title transfers to the investor while the existing mortgage remains in the seller's name. We make the payments. The sellers are released from the daily obligation, receive an agreed payment at closing, and move forward.
What sellers need to understand — and what many online courses skip — is the ongoing liability that remains. The mortgage stays in the seller's name. We disclosed all of it. We gave them $10,000 at closing. All parties agreed.
The husband and son moved out.
What Happened After We Took the Keys
Three professional fumigation and remediation sessions. Between sessions, the house sat vacant.
Vacant properties in DFW carry risk. Someone got in. Squatters occupied the property.
The Fire
The squatters were cooking in the garage. The fire started from that activity.
Electrical damage. Roof damage. The squatters removed through the Texas forcible detainer process.
What did not happen: structural damage. The fire was contained.
Within two weeks of the fire, we found buyers — a couple who wanted that location in that neighborhood and were willing to close once repairs were complete. We fixed the electrical damage and the roof. We repainted the interior.
The Close
Here is the complete financial picture on this deal:
| Item | Amount |
|---|---|
| Cash paid to sellers at closing | $10,000 |
| Down payment received from end buyer | $15,000 |
| Net at closing | $30,000 |
| Ongoing monthly cash flow | $600+/month |
| Note equity retained on the property | $90,000 |
The $15,000 down payment from our end buyer is what pushed the closing figure to $30,000. But the number I keep coming back to is the $90,000 in note equity we continue to hold on this property. That is the long-term value sitting inside a deal that looked, at multiple points, like it was going to fall apart entirely.
The monthly cash flow of $600+ is real income. The $90,000 in note equity is a real asset — equity that grows as the end buyer pays down the principal and the property continues to appreciate in a high-demand Dallas location.
Three fumigations. Squatter removal. A garage fire. Two weeks of emergency repairs. And then a close that produced $30,000 at closing, $600+ per month ongoing, and $90,000 in note equity we continue to hold.
That math works.
What This Deal Actually Proves About Subject-To
This deal worked because of specific conditions. Not all subject-to deals have them.
The mortgage rate spread was meaningful. A 3.5% mortgage at 305 basis points below the current market rate has real, quantifiable value. Many subject-to pitches involve properties with market-rate mortgages — the rate advantage disappears, and so does much of the rationale.
Location supported end buyer demand. Finding an end buyer is the single hardest part of any subject-to deal. Prime Dallas location helped. In weaker markets, this deal might still be vacant.
We had capital to absorb the unexpected. The fumigation, fire damage, and squatter removal each cost real money. An investor stretched thin cannot absorb a garage fire and continue.
Subject-to is a legitimate tool. It is not a simple one. The full story — including the fumigations, the fire, the 2-week sprint to close — is what subject-to actually looks like when it works.
Frequently Asked Questions
What is a subject-to real estate transaction for sellers?
A subject-to transaction transfers property title to a buyer while the seller's existing mortgage remains in place — in the seller's name. The buyer makes mortgage payments, but the loan does not transfer. The benefit: an exit from a property the seller can no longer afford. The risk: the mortgage remains on the seller's credit record until paid off or refinanced.
Is subject-to real estate legitimate or a scam?
Subject-to is a legitimate transaction structure used by experienced investors. It requires full disclosure of ongoing seller liability, a verifiable investor track record, and closing through a licensed title company. Any investor who rushes past these disclosures is a red flag.
What happens if squatters enter a property during a real estate transaction?
In Texas, squatter removal requires a forcible detainer suit in the justice of the peace court — typically 3–6 weeks from filing to completed removal. Self-help removal (changing locks while someone is inside, shutting utilities) is illegal and creates liability. File immediately and document every step.
What did the sellers receive in this deal?
$10,000 at closing and relief from a monthly payment they could not sustain. They received an exit from a deteriorating situation, with money in hand and no foreclosure on their credit record.
Related: Subject-To Real Estate Texas · Squatters in Your Vacant Home · Divorce + Behind on the Mortgage
References:
- ATTOM Year-End 2025 U.S. Foreclosure Market Report, January 15, 2026. attomdata.com
- ATTOM January 2026 U.S. Foreclosure Market Report (Texas REO data), February 11, 2026. attomdata.com
- Bankrate.com — Current Mortgage Rates, May 29, 2026
- NerdWallet — Current Mortgage Rates, May 29, 2026