Assumable Mortgages

Written by Norene Anderson
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Assumable mortgages are just one of the many types of mortgages available. This type of loan is not as popular as some of the other types of loans, but it is still the loan of choice in some situations. One of the big selling points to this loan type is the possibility to obtain a home with low interest. This is particularly enticing when the homeowner's loan is at a lower interest rate than the current market.

One of the factors to consider before checking about assumable mortgages is the amount of money available for a down payment. When a homeowner offers an assumable mortgage option, it means the difference in the balance of the loan and the asking price must be paid in cash up front. This is a great deal for both if the cash is available to pay the difference. This type of loan also saves money on closing costs. It is often a much faster way to sell a home. The buyer does, however, still have to meet the requirements of the lending institution before assumption is granted.

Check Details of Assumable Mortgages

Something to be aware of in assumable mortgages is the possibility of becoming liable if the buyer defaults on payments. It must be clearly specified and have the paperwork to prove that all rights and responsibilities regarding the property become solely that of the buyer. This is one of those situations where the seller and buyer must have clear documentation of all matters regarding the transaction.

If done correctly and in a way to protect both the buyer and the seller, an assumable mortgage can work to the advantage of both. Before making any commitment as either the buyer or the seller, do your homework. Check out the information available on the Internet about the complete process for making the sale of a home or property on an assumable basis. Pay close attention to the details.

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