Assumable Mortgage
An assumable mortgage lets a buyer take over the seller's existing loan balance, interest rate, and repayment terms instead of getting new financing — valuable when the existing rate is well below current market rates.
Assuming a loan means the buyer formally steps into the seller's place on the note, subject to lender approval and the buyer's own credit and income qualification. This is different from an informal transfer, where the loan stays in the seller's name — see subject-to.
FHA, VA, and USDA loans are commonly assumable with agency or lender approval; most conventional conforming loans, by contrast, contain a due-on-sale clause that blocks assumption outright.
Sellers holding a low, pre-2022-era rate can market an assumable loan as a genuine selling point, potentially widening the buyer pool and preserving value that a buyer would otherwise lose to today's rates. Eligibility and approval timelines vary, so confirm specifics with the loan servicer before marketing the assumption.
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